Filtered Insights

BC’s restricted insurance agency regime: Preparing for licensing

Fri, 06 Nov 2026 00:00:00 Z

British Columbia’s Restricted Insurance Agent Licence Regulation comes into force on Jan. 1, 2027, introducing a restricted insurance agency (RIA) licensing regime for specified businesses that sell insurance incidental to their ordinary business. Affected businesses should begin preparing their licensing information, compliance arrangements and representative training now.

Applications open Jan. 4, 2027

The Insurance Council of British Columbia (the council) administers RIA licensing. Applications open on Jan. 4, 2027, through the online portal on the council’s website. An application checklist and detailed instructions will be available on the council’s website in early Dec.2026. To continue selling incidental insurance, qualifying businesses must apply for a restricted insurance agency licence by March 31, 2027.

Licence types and transition provisions

RIA licences renew annually on June 1. Temporary transition provisions allow the following licences to be issued starting Jan. 4, 2027:

Standard RIA licence: Available to applicants meeting all licence qualification requirements. Successful applicants that apply by May 31, 2027, will receive a standard licence expiring May 31, 2028, with their first annual renewal on June 1, 2028; and
Term RIA licence: Available for applications submitted before March 31, 2027, where the business meets all qualification requirements except approved training and attests that its representatives have completed an existing training program covering the required content (the RIA performance requirements). This pathway is not an exemption from training. The term licence converts to a standard licence once the business confirms that representatives are enrolled in accredited training. Term licences may run for up to 17 months and expire on May 31, 2028.

Who should prepare?

The RIA licence regime applies to the business categories and corresponding insurance products specified in the regulation. A reference table is provided at the end of this bulletin.

An RIA licence permits an eligible business to sell specified insurance through employees or agents (non-employee representatives), subject to its responsibilities as licence holder. Businesses should assess both their business classification and the products they distribute rather than assume all incidental insurance sales fall within the RIA framework. An organization offering insurance for more than one business type named in the regulation must hold a separate RIA licence for each business type.

Licence qualification requirements

The council’s guidance identifies the following qualification requirements, subject to the term-licence transition arrangements described above.

Business information and suitability: Provide contact, ownership and corporate registration information and disclose matters that could affect suitability, including bankruptcy, regulatory discipline or criminal convictions.
Errors and omissions insurance: Maintain coverage for all insurance business related to the classes of insurance applied for, with limits of at least C$1 million per claim and C$2 million in the annual aggregate.
Insurer authorization: Have written authorization to represent at least one British Columbia Financial Services Authority (BCFSA)-authorized insurer for the insurance business to be conducted under the RIA licence. Note: Types of businesses (classes of persons) that offer warranty insurance guaranteed by the product or vehicle manufacturer are exempt from this requirement.
Designated representative: Appoint a designated representative (DR) to oversee the agency’s regulatory compliance and insurance activities. The DR must be an officer, director or partner of the agency, or a sole proprietor and must complete the council’s four-hour online designated representative course covering the role’s expectations and responsibilities. The course within 60 days of registration ($320 course fee, payable through the council’s portal); and
Product training: Have approved training for the insurance products the business intends to sell (the council is currently accepting applications for training approval, and accredited training will be listed on the council’s website as it is approved). Sales representatives must complete the required training before offering insurance products to consumers. Under the term RIA Licence pathway described above, representatives must have completed an existing training program covering the RIA performance requirements.

Licensing fees

The RIA licence application fee is C$1,000. If the application is successful, an annual licence fee is payable when the licence is issued, based on the number of representatives operating under it:

Representatives under the license	Annual Licence fee
1-10	C$650
11-20	C$800
21-99	C$1,500
100-249	C$3,000
250-499	C$5,400
500 or more	C$7,000

An additional C$25 government fee applies to annual licence fees on behalf of the BCFSA.

Contact us

For assistance assessing how the RIA regime applies to your business, preparing a licence application or reviewing your training, disclosure and compliance arrangements, please contact any of the key contacts listed below.

Reference: Eligible businesses and insurance classes

Types of business	Classes of insurance
Construction equipment dealerships	Credit protection insurance Construction equipment warranty insurance Guaranteed asset protection insurance
Credit grantors	Credit protection insurance
Customs brokers	Cargo insurance
Deposit-taking institutions	Credit protection insurance
Extraprovincial trust corporations	Credit protection insurance
Farm implement dealerships	Credit protection insurance Farm implement warranty insurance Guaranteed asset protection insurance
Freight-forwarding companies	Cargo insurance
Funeral providers	Funeral services insurance
Mortgage brokerages	Credit protection insurance
Motor vehicle dealers	Credit protection insurance Guaranteed asset protection insurance Vehicle warranty insurance
Peer-to-peer vehicle service providers	Rented vehicle insurance
Pleasure craft dealerships	Credit protection insurance Guaranteed asset protection insurance Pleasure craft warranty insurance
Portable electronic vendors	Portable electronics insurance
Transportation companies	Cargo insurance Travel insurance
Travel agents	Rented vehicle insurance Travel insurance
Travel wholesalers	Rented vehicle insurance Travel insurance
Trust companies	Credit protection insurance
Vehicle rental agencies	Rented vehicle insurance

Budget 2026: Forgetting to file tax forms could cost up to eight times more

Fri, 06 Nov 2026 00:00:00 Z

On Nov. 5, 2026, the Canadian Federal Government released the 2026 Federal Budget with the aspirational title “Masters of our Destiny”, introducing a medley of new tax measures (Budget 2026). Read BLG’s comprehensive analysis for a broader overview of the 2026 federal budget measures.

Budget 2026 features some positive headline ideas but also quietly introduces a significant increase in administrative penalties.

What you need to know

Standard administrative penalties are increasing across the board;
Large-sized corporations are now subject to higher penalties than small corporations or individuals; and
There are new penalties being introduced for “repeated” offences.

What administrative penalties are impacted?

Most of the administrative penalties targeted by Budget 2026 apply when a taxpayer fails to file a tax form correctly and on time (or alternatively where forms do not contain all required information). The affected forms include standard tax returns such as T1’s for individuals and T2’s for corporations, and information forms such as T4’s issued to employees or T5013’s which provide information about partnership income. For a full list of provisions affected by the proposed changes, see the reference list at the end of this insight.

The administrative penalties targeting information returns have increased substantially. This trend aligns with recent changes that propose measures to compel taxpayers to provide information, as seen in recent amendments to Reportable and Notifiable Transactions, and proposed changes to the Canada Revenue Agency (CRA) audit powers.

The changes proposed in Budget 2026 shift additional administrative compliance burdens onto taxpayers who must now take on additional financial risk and responsibility in their compliance efforts.

Indexing penalties to account for inflation

Budget 2026 proposes a two-pronged approach that increases penalties for non-compliance:

First, the fixed dollar amounts of most administrative penalties will increase to account for historic inflation; and
Second, these same fixed dollar amounts will adjust every five years to match changes in the Consumer Price Index.

Notably, although many penalty amounts are increasing, Budget 2026 does not propose to increase or index the fixed dollar amount of unindexed tax credits. In Aug. 2026, STEP Canada recommended to the Department of Finance that certain benefits, credits and deductions be indexed to inflation to provide taxpayers with the monetary value intended by Parliament when these provisions were first enacted. STEP Canada’s recommendations were not adopted in Budget 2026.

This results in a somewhat inconsistent approach as administrative penalties have been increased and indexed, but there is no corresponding indexation of many benefits, credits and deductions which continue to erode in real value due to inflation.

For example, currently, if personal-use property is sold for proceeds of C$1,000 or less, then there is deemed to be no resulting gain (and therefore no tax liability) on the sale of the property. However, Parliament introduced this C$1,000 figure in 1972 and has not adjusted it for inflation in 54 years. If indexed to inflation, this threshold for the sale of personal-use property would exceed C$3,000.

New tiered penalty structure

Budget 2026 also introduces a new tiered structure that increases certain penalties proportionally based on the size of the taxpayer. These changes will apply in addition to the aforementioned increases for inflation, making the impact on large corporations significant (often up to eight times the current penalty).

Although the approach is based in fairness and seeks to balance the effect of penalties while maintaining an element of deterrence, the circumstances being targeted are wide-ranging and could lead to compounding results based on the interaction of the provisions. These changes may result in significant economic burdens that punish businesses for relatively simple administrative compliance mistakes.

Budget 2026 adds four new definitions to the Income Tax Act related to tiered penalties:

large-sized corporation: the taxable capital employed in Canada of the corporation and related corporations at the end of the particular taxation year exceeds C$50 million
medium-sized corporation: the taxable capital employed in Canada of the corporation and related corporations at the end of the particular taxation year exceeds C$10 million but does not exceed C$50 million.
large-sized partnership: a partnership with gross revenue equal to or greater than C$10 million.
medium-sized partnership: a partnership with gross revenue equal to or greater than C$2 million and less than C$10 million.

One of the broader penalty provisions introduced in Budget 2026 is titled "Failure to comply – duty or obligation". And although a version of this previously existed in s. 162(7)(b) of the Income Tax Act, it is not often used by the CRA. This provision (along with its "repeated failure" counterpart) will allow the CRA to apply penalties for failures such as not responding to audit queries (even in part) under s. 231.1. If the taxpayer is a “large-sized corporation”, those penalties could be up to $25,000 per failure. In a large corporate group, the application of penalties in this instance could compound quickly where multiple entities are under audit and have multiple queries issued across various audits.

As another example, if a "large-sized corporation" had 100 employees and failed to file T4 slips for each one, a penalty of C$20,000 could be levied. If that same corporation failed to file T4s on time in any of the three preceding years, even if late by a single day, that penalty could increase to C$60,000.

Lastly, the 2026 Budget also proposes to increase the maximum fixed fee penalty for late-filing a section 85(1) rollover election from C$8,000 to C$24,000 and triples the monthly fixed penalty accruing from C$100 to C$300. Such elections can be made up to three years late. Beyond three years, the Minister may exercise his discretion to permit the late-filing of such an election. Currently, the penalty for a late-filed election is the lesser of a calculated percentage amount arising from the difference in fair market value and elected transfer price of the transferred asset, or a fixed fee of C$100 for every month late to a maximum of C$8,000. Most rollovers functionally trip the fixed fee rather than the percentage fee, meaning that each late-filing of a Form T2057 would carry a maximum penalty of C$24,000.

Overview of Income Tax Act provisions impacted by proposed changes:

Section 66(12.75): Flow-through share prescribed forms;
Paragraph 85(8)(b): Late-filed section 85 rollover elections;
Paragraph 93(6)(b): Late-filed foreign affiliate elections;
Subparagraphs 96(6)(a)(ii) and (b)(ii): Late-filed partnership elections;
Subsection 149(7.1): Labour organization information returns;
Subsections 162(2) and (2.01): Repeated failure to file income tax return;
Subsection 162(2.1): Non-resident corporation failure to file;
Subsection 162(3): Trustee failure to file return;
Subsection 162(4): Failure to file certain certificates;
Subsections 162(5) and (5.01): Missing information on prescribed forms;
Subsection 162(6): Failure to provide identification number;
Subsection 162(7): Failure to file information return;
Subsections 162(7.001) and (7.002): Repeated failure to file information return;
Subsection 162(7.003): Failure to comply with duty or obligation;
Subsections 162(7.004) and (7.005): Repeated failure to comply with duty or obligation;
Subsection 162(7.01): Late filing of prescribed information returns;
Subsection 162(7.02): Failure to file prescribed information returns electronically;
Subsection 162(7.1): Partnership information return failure;
Subsection 162(7.11): Definitions for entity-size penalties (interpretive rule);
Subsection 162(7.3): Tax preparer electronic filing failures;
Subsection 162(7.4): Electronic payment failure;
Subsection 162(8): Repeated partnership information return failure;
Subsection 162(8.1): Administration of partnership penalties (interpretive rule);
Subsection 162(10): Gross-negligence failure to file foreign reporting returns;
Subsection 162(10.1): Additional foreign reporting penalty;
Subsection 162(11): Calculation rule for late-filing penalties (interpretive rule);
Section 162.1: Inflation indexing of administrative penalties (interpretive rule);
Subsection 163(2): Gross negligence / false statement or omission;
Subsection 163(2.4): False statements or omissions in foreign reporting;
Subsection 163.2(3): Third-party planner / preparer penalty;
Subsection 163.2(5): Third-party false statement penalty;
Subsection 163.3(2): Electronic sales suppression device possession or use;
Subsection 163.3(3): Electronic sales suppression device manufacture or development;
Subsection 163.3(4): Electronic sales suppression device supply;
Subsection 188.1(6): Charity / qualified organization failure to file information return;
Subsection 220(3.5): Late or amended elections;
Subsection 237.1(7.4): Tax shelter reporting / identification penalty;
Subsection 281(3): CRS failure to provide TIN;
Subsection 293(3): Digital platform reporting failure to provide TIN; and
Subsection 303(3): Crypto-asset reporting failure to provide TIN.

Federal Budget 2026: Sovereignty, strategic investment and tax simplification

Fri, 06 Nov 2026 00:00:00 Z

On Nov. 5, 2026 (Budget Day), the Hon. François-Philippe Champagne, Minister of Finance, tabled the federal budget, titled "Masters of Our Destiny" (Budget 2026). As foreshadowed, Budget 2026 focuses on cultural and economic sovereignty, economic growth and affordability measures for Canadians. In addition to significant investments in defence and economic development, Budget 2026 includes allocations to build more homes, with a commitment to end homelessness in 10 years.

On Sept. 15, the government announced the Productivity Mega Deduction (PMD), extending immediate expense to almost two-thirds of capital assets. This measure on its own constituted major tax policy support for Canadian business, in terms of reducing the after-tax cost of new business investment and (equally as important) bettering the comparable U.S. move made in July 2025. Most importantly, it signaled a more activist approach to tax policy: in the government’s words, "a sea change in how Canada intends to stimulate business investment decisions."

Budget 2026 continues this theme and includes several tax measures aimed at increasing investment in Canada, in addition to the previously announced "mega-deduction". A new "Canada Growth Incentive" is meant to encourage Canadians to invest in home-grown companies, including a new C$15 million capital gains exemption along with enhanced rollover provisions for reinvestment in certain Canadian companies. Enhancements to mineral exploration tax credits aim to expand resource development. Clean electricity and technology credits for corporations are being augmented, and Budget 2026 proposes to broaden the Scientific Research and Experimental Development (SR&ED) tax incentive program. The government is also inviting consultations on sharing corporate losses within corporate groups and has introduced certain preliminary measures.

Further, in response to calls to simplify the Canadian tax system, Budget 2026 is “…launching the most ambitious effort in a generation to improve how Canadians interact with the tax system and reduce the time spent on complying with tax obligations…”. While tax measures in Budget 2026 fall short of a full-scale review, they include significant steps in this direction. The government has proposed to merge registered retirement savings plans (RRSPs) and registered retirement income funds (RRIFs), limiting the need to transition between plans as account holders age. Revisions to tax filing deadlines, taxpayers objection windows, and instalment requirements will reduce late filings and unnecessary interactions with the Canada Revenue Agency (CRA). Various tax credits have been expanded or made refundable, putting additional funds in the pockets of lower- and middle-income Canadians.

At the same time, a new flat-credit option for numerous boutique tax credits replaces receipt-based calculations, streamlining tax filing. The excess corporate business holdings regime for private foundations is also being eliminated, in favour of rules consistent with public foundations, and the taxable preferred share regime is generally being eliminated for Canadian-controlled private corporations. These measures will certainly help reduce tax complexity and compliance costs for several Canadians.

Budget 2026 includes these and several other tax measures, alongside the implementation of many of the previously announced, as detailed below.

British Columbia Insurance Update: Insurer and Agent Licensing Exemptions for Motor Vehicle Manufacturers and Dealers

Fri, 06 Nov 2026 00:00:00 Z

Insurer exemptions are changing for motor vehicle manufacturers and dealers

British Columbia’s Restricted Insurance Agent Licence Regulation (RIA Regulation) comes into force Jan. 1, 2027. The RIA Regulation will change how dealers’ market and sell vehicle warranty insurance and other ancillary insurance products. In addition, related amendments to the Insurer Exemption Regulation narrow the current exemption under section 75 of the Financial Institutions Act for motor vehicle manufacturers and dealers that act, or offer to act, as insurance agents through their employees or agents for such products.

Section 75 of the Financial Institutions Act generally prohibits carrying on insurance business in British Columbia without authorization. Section 4(1)(a) of the Insurer Exemption Regulation currently provides an exemption for a manufacturer or retailer that provides vehicle warranty insurance solely incidental to its sale of the vehicle. Under B.C. law, vehicle warranty insurance captures all plans that provide coverage for loss of, or damage to, a motor vehicle arising from mechanical failure, whether backed by an insurer or the manufacturer.

Effective Jan. 1, 2027, the new section 4(1.1) of the Insurer Exemption Regulation, B.C. Reg. 366/2007 limits that exemption:

Manufacturer’s and retailer’s warranties

4(1) Subject to subsection (1.1), section 75 of the Act does not apply to

(a) A manufacturer or a retailer,

that provides vehicle warranty insurance or product warranty insurance that is solely incidental to the sale of the vehicle or product by the manufacturer or retailer.

[…]

(1.1) The exemption from section 75 of the Act in subsection (1) of this section does not apply to a person that is any of the following:

[…]

(c) a motor vehicle dealer, as defined in section 1 of the Restricted Insurance Agent Licence Regulation, or a manufacturer of motor vehicles;

[…]

when the person, through the person’s employees or agents, acts or offers to act as an insurance agent, as defined in section 168 of the Act.

Employees and agents of restricted insurance agent licensee

4.2 Section 75 of the Act does not apply to an employee or agent of a person that is licensed under section 174.1 of the Act as a restricted insurance agent when the employee or agent carries on insurance business in accordance with the licence.

For the automotive sector, the limitation applies to motor vehicle dealers and manufacturers, as well as specified related corporations, including commonly owned affiliates, parent corporations and wholly owned subsidiaries, when they act or offer to act as “insurance agents” through their employees or agents.

Section 168 of the Financial Institutions Act defines “insurance agent” broadly to include a person, other than an insurance company or extra provincial insurance corporation, who solicits, obtains or takes an application for insurance, negotiates for or procures insurance, signs or delivers a policy, or collects or receives a premium.

For manufacturer-backed vehicle warranty insurance, the amendments do not remove the exemption solely because a manufacturer acts as the obligor. The key question is whether the manufacturer also acts or offers to act as an insurance agent through its employees or agents.

Insurance agent licensing changes

Separate from the insurer authorization exemption, section 2(1)(g) of the Insurance Licensing Exemptions Regulation currently exempts motor vehicle dealers and certain representatives from insurance agent licensing requirements for incidental sales of vehicle warranty insurance. That exemption will be repealed effective Jan. 1, 2027, subject to transitional provisions. Dealers wishing to continue those sales will need to obtain an RIA licence.

To review qualification requirements and the application process for an RIA licence, read our bulletin.

Contact us

To discuss how these insurer exemption changes or the RIA licensing rules affect your business, reach out to the authors.

Online newspapers can rely on Ontario’s defamation limitation period, but conditions apply

Fri, 06 Nov 2026 00:00:00 Z

Ontario’s Libel and Slander Act, RSO 1990, c L.12 (LSA) came into existence long before courts needed to grapple with defamation on the internet. The Ontario Court of Appeal’s recent decision in Massoudi v. Vice Media LLC, 2026 ONCA 771 confirms that online newspapers can benefit from the 3-month limitation period in the LSA, as long as the other statutory requirements are met.

Under ss. 5(1) and 6 of the LSA, a person alleging defamation in a newspaper must provide written notice within six weeks and commence an action within three months after learning of the alleged libel. If those requirements are not met, the action cannot proceed. However, pursuant to s. 7 of the LSA, these sections only apply where a newspaper is “printed and published in Ontario”. In this recent decision, the Court of Appeal held that an exclusively online newspaper may be considered “printed and published in Ontario” even if the data generating the publication is hosted on a server outside the province.

But meeting that requirement alone does not entitle a publisher to rely on the LSA’s limitation period. Section 8(1) also requires the newspaper to identify its publisher and proprietor and its address of publication. The Court of Appeal held that this strict requirement was not complied with in this case and accordingly, the defendant was unable to claim the benefit of the time bar under the LSA.

Key takeaways

The LSA’s limitation period applies in the digital context. The Court confirmed that an exclusively online newspaper may satisfy the s. 7 requirement that a newspaper be “printed and published in Ontario”. A physical newspaper need not be generated in the province.
Mere access by Ontarians is not enough to establish that online content is published in Ontario. The Court set out a number of contextual factors including where the content was created, the location of the publisher and proprietor of the content, its target audience and subject matter, and the location of the persons who accessed and read it.
Publishers must meaningfully comply with s. 8(1) to obtain the benefit of the LSA’s limitation period. Although technical defects may be forgiven where there has been partial or attempted compliance, the Court held that the publisher’s identity cannot simply be omitted.

Background

The dispute arose from a November 2013 article published on VICE.com concerning allegations that someone in then-Toronto mayor Rob Ford’s office had hired a hacker to destroy a video. The article identified Amin Massoudi, the mayor’s communications director and press secretary, as the staff member who had hired the alleged hacker. Hours after publication, Massoudi contacted the article’s author and VICE’s editor-in-chief, threatening legal action and alleging that the article was defamatory.

Massoudi commenced his defamation action against VICE, the author of the article, and the anonymous source identified in the article, on March 14, 2014, just over four months after publication. The defendants sought summary judgment on the basis that the action was commenced outside the three-month limitation period prescribed by s. 6 of the LSA.

The motion judge held that the statutory requirements to dismiss the application under the LSA had been met. The motion judge found that:

the article was printed and published in Ontario;
the publisher’s information was made available through an “About Us” page; and
Massoudi had commenced the action more than three months after the publication.

The motion judge consequently dismissed the action as statute-barred under the LSA.

The Court of Appeal’s decision

The Court of Appeal unanimously allowed the appeal, holding that while the motion judge did not err in her interpretation or application of s. 7, a reversible error was committed in interpreting and applying s. 8 of the LSA.

Section 7: applying “printed and published in Ontario” to online newspapers

The Court rejected Massoudi’s position that the article could not have been “printed” in Ontario for the purposes of satisfying s. 7 because the data generating VICE’s online content was housed on a server outside of Ontario. Referencing earlier decisions in Weiss v. Sawyer, 2002 CanLII 45064 (ON CA) and John v. Ballingall, 2017 ONCA 579, the Court emphasized that the LSA must be interpreted in a manner capable of applying to evolving methods of publication. Newspapers do not lose their character as newspapers merely because they are published online, and the LSA’s notice and limitation regime apply equally to digital publications. The Court therefore held that, where a newspaper only appears online, s. 7 may be satisfied even though its content is “printed” exclusively in digital format. In these circumstances, the place of printing is the place of publication, and the physical location of the server hosting the publication’s data was not determinative.

In establishing the location of the publication, mere accessibility to Ontario readers is insufficient. The Court set out the following relevant considerations:

where the content was created;
who created the content and in what capacity;
the location of the publisher and proprietor of the online content;
the target audience and subject matter of the online content;
any indication on the website of the place of publication or printing; and
the location of persons who accessed and read the content.

Section 8: “substantial compliance” has limits

The Court held that the motion judge adopted an unduly broad conception of substantial compliance with s. 8 of the LSA. Although prior decisions permit some technical deficiencies in satisfying s. 8(1), they do not permit a publisher to omit critical information altogether. In this case, the deficiency was substantive rather than merely technical. The motion judge found Vice Media Canada Inc. to be both the publisher and proprietor, yet its name did not appear on the relevant “About Us” pages or masthead. Instead, an individual was identified as the publisher. The Court held that the complete failure to identify Vice Media Canada Inc. could not be treated as substantial compliance. While the Court acknowledged that an “About Us” page could, in appropriate circumstances, substantially comply with the publication requirement, the publisher must nonetheless be unequivocally identified in a prominent location.

The Court also rejected the proposition that Massoudi’s own knowledge cured the deficiency. The evidence did not establish that Massoudi understood Vice Media Canada Inc. to be a separate Canadian corporation or the publisher responsible for the article. Indeed, his initial claim named Vice Media Inc. but did not name Vice Media Canada Inc., which was added later, on consent.

The Court therefore held that the defendants had not substantially complied with s. 8(1) and were consequently not entitled to rely on the three-month limitation period in s. 6. It allowed the appeal and set aside the order dismissing the action.

Bill S-8: Proposed Changes to Canada’s Financial Crime Framework

Thu, 05 Nov 2026 00:00:00 Z

Bill S-8, the Combatting Financial Crimes and Drug Trafficking Act (Bill S-8) marks the latest step in Canada’s push to strengthen its financial crime framework. Introduced on November 3, 2026, Bill S-8 would impose new obligations and restrictions on money services businesses (MSBs), crypto ATM operators and businesses handling certain cash transactions.

Bill S-8 comes at a time of heightened scrutiny of Canada’s response to money laundering and other financial crime, alongside growing concerns about organized crime, national security and the use of new technologies to facilitate illicit activity. It also reflects a broader shift toward stronger supervision and enforcement and greater coordination across Canada’s anti-money laundering (AML), payments and national security frameworks. Against that backdrop, Bill S-8 would expand regulatory and law enforcement tools while imposing new operational and compliance requirements on affected businesses.

This alert highlights the key measures and practical considerations businesses should be assessing as Bill S-8 moves through Parliament.

New Ministerial Powers

Registration with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) could become subject to a broader assessment than compliance with the PCMLTFA alone. National security and the integrity of Canada’s financial system would become express considerations in determining whether a business may obtain or retain its registration.

Where the Minister of Finance (Minister) considers a review necessary on national security or financial system integrity grounds, the Minister could review a new or existing registration application and direct FINTRAC to deny or revoke the registration. The Minister could also temporarily suspend FINTRAC’s consideration of all registration or renewal applications, or applications from a specified class of businesses. Bill S-8 would further allow regulations to temporarily limit or prohibit certain domestic transactions in prescribed circumstances.

These powers would initially have particular significance for MSBs, who are currently required to register with FINTRAC. However, Bill S-8 refers more broadly to registered persons and entities. Their potential reach could therefore expand considerably when the planned universal registration regime comes into force, requiring other PCMLTFA reporting entities to register with FINTRAC.

Enhanced Oversight of MSBs

For MSBs, Bill S-8 would make registration an increasingly important regulatory gateway. A business could face consequences for its ability to operate not only because of customary PCMLTFA compliance concerns, but also because of national security concerns and, for businesses that are also payment service providers (PSP), regulatory action under the Retail Payment Activities Act (RPAA).

Bill S-8 would expand FINTRAC’s authority to refuse or revoke the registration of an MSB. The expanded grounds would include where the Minister has directed that the business is ineligible for registration, the business has failed to make substantial progress in complying with a compliance order, or the grounds for a prior refusal or revocation remain unresolved. Significantly, an MSB could also become ineligible for FINTRAC registration where the Minister directs the Bank of Canada to refuse or revoke its registration as a payment service provider (PSP) under specified national security provisions of the RPAA. This creates a direct regulatory link between the AML framework under the PCMLTFA and the payments framework under the RPAA.

The proposed amendments would also expand criminal record screening to owners and investors holding an interest of at least 5% and require newly registered MSBs to provide additional information about the commencement of their operations, financial arrangements and services. For MSBs, this means greater scrutiny not only of the business itself, but also of its ownership and the information supporting its registration.

New Requirements for Crypto ATM Operators

Crypto ATM operators would face significantly more prescriptive requirements under Bill S-8, including identity verification, record keeping and reporting obligations, together with a $1,000 transaction limit over any 24-hour period.

Bill S-8 would introduce a dedicated framework for virtual currency automated teller machines (crypto ATMs). Among other requirements, if Bill S-8 is enacted, crypto ATM operators would be subject to the following measures:

limit on customer’s transactions at $1,000 over any 24-hour period;
identity verification and record keeping obligations in respect of transactions;
reporting transactions to FINTRAC, including prescribed transaction, customer and digital wallet information;
comply with information requirements applicable to virtual currency transfers; and
provide prescribed information about their crypto ATMs to FINTRAC.

These requirements would be supported by administrative monetary penalties and criminal offences. Bill S-8 would also prohibit operating a crypto ATM without any licence required under applicable provincial or territorial law and would extend potential liability to persons who knowingly provide certain services supporting the operation of an unlawfully operated machine.

Restrictions on Certain Cash Transactions

The proposed restrictions on large cash transactions and third party cash deposits are not new. They were first proposed in Bill C-2, the Strong Borders Act, in 2025 and have now resurfaced in Bill S-8. If enacted, the measures would have implications beyond traditional PCMLTFA reporting entities, particularly for businesses and professionals in Canada that accept significant amounts of cash.

Bill S-8 would generally prohibit businesses, professionals and organizations soliciting public donations from accepting cash payments, donations or deposits of $10,000 or more, whether in a single transaction or a prescribed series of related transactions. Certain reporting entities would be excluded, with further exceptions to be prescribed by legislation. Bill S-8 would also restrict certain reporting entities from accepting cash deposits into an account from someone other than the account holder or a person authorized to give instructions on the account, again subject to prescribed exceptions.

For affected businesses, these measures represent a shift from reporting large cash transactions to restricting them outright. Businesses that routinely accept cash would therefore need to consider the application of the proposed prohibition to their payment practices and, if this Bill S-8 measure is enacted, what changes to transaction controls, customer communications or payment options may be required.

Information Sharing Expansion

Bill S-8 would clarify when reporting entities may collect and use information disclosed by government or law enforcement authorities for purposes related to detecting or deterring money laundering, terrorist financing and sanctions evasion. Further, the amendments would allow this information to be collected and used without the individual’s knowledge or consent and would provide protection from liability where a reporting entity does so in good faith and in accordance with the PCMLTFA.

This measure would give reporting entities greater certainty about how they can use information received from government or law enforcement and incorporate it into their financial crime controls, including transaction monitoring and other risk management processes.

Postal Enforcement Measures

Bill S-8 proposes to expand law enforcement’s ability to intercept illicit goods moving through the Canadian postal system by facilitating the search, seizure, detention and retention of mail under specified federal statutes. The proposed measures are intended to address existing constraints on investigating the use of the postal system for drug trafficking and other criminal activity.

Looking Ahead

As Canada’s financial crime regime continues to evolve, businesses will need to assess how new requirements affect their existing compliance programs and operations. Businesses that are newly subject to the regime, or entering Canada, will also need to determine how these requirements apply to their activities and build appropriate compliance frameworks from the outset. This includes identifying gaps, updating or developing risk assessments, policies and procedures, and ensuring that controls remain appropriate in light of changing regulatory expectations and increased supervisory and enforcement activity.

BLG’s Financial Services Regulatory team regularly advises businesses on financial crime regulatory requirements, as well as businesses entering Canada on the application of the PCMLTFA, the RPAA and all related financial services requirements.

For questions about Bill S-8, how these developments may affect your business, or any other financial services regulatory requirements, please contact a member of our team.

The Stablecoin Era: Canada Proposes Stablecoin Regulations and Expands the Payment Regulatory Framework

Wed, 04 Nov 2026 00:00:00 Z

In a development likely to attract significant interest across the stablecoin and payments sectors, on October 24, 2026, the Department of Finance released proposed Stablecoin Regulations (Regulations) under the Stablecoin Act (SCA), together with related amendments to the Retail Payment Activities Regulations (RPAR). The Regulations operationalize the SCA by establishing detailed requirements for stablecoin issuers, while the related RPAR amendments would bring certain payment service providers (PSPs) that perform payment functions using prescribed stablecoins within the regulatory framework of the Retail Payment Activities Act (RPAA). The public consultation is open until December 23, 2026.

Now that these proposals have been released, the practical contours of Canada’s new federal framework for stablecoin issuance are coming into focus. The SCA received royal assent in March 2026 but is not yet in force. Once in force, it will establish a framework administered by the Bank of Canada and applicable to domestic and foreign issuers other than financial institutions and central banks. The proposed Regulations mark an important step toward implementation, detailing how that framework would operate in practice.

Stablecoin Issuers: Proposed Requirements

The Regulations propose a broad range of registration, financial, governance and ongoing compliance requirements for stablecoin issuers subject to the SCA, as summarized below.

Registration and National Security Review: Issuers would be required to register with the Bank of Canada and include information prescribed by the Regulations in their application. Applications could be subject to national security review by the Minister of Finance (Minister).
Prohibitions: The Regulations would prohibit issuers from paying interest or yield tied to holding a stablecoin, including through arrangements with intermediaries or other parties that encourage holders to acquire more of the stablecoin or hold it for longer. Issuers would also be prohibited from using terms, expressions, logos, symbols, illustrations or other representations that falsely or misleadingly suggest that a stablecoin pays interest or yield, is legal tender, constitutes a deposit or proof of deposit, is protected by a public deposit insurance regime, or is government guaranteed. Similar restrictions would apply to representations that an issuer is registered with the Bank of Canada when it is not. Rewards or payments tied solely to the use, rather than the holding, of a stablecoin would remain permitted.
Redemption: Issuers would be required to redeem stablecoins on request, at par in the reference currency, and without a minimum redemption amount. Importantly, issuers would generally need to complete the necessary liquidation of reserve assets and initiate the transfer of the redemption proceeds within three business days. However, an issuer could limit the amount redeemed on a particular day where a market liquidity shortfall prevents it from satisfying all redemption requests. Issuers would also need to publish a clear and publicly accessible redemption policy, provide it to the Bank of Canada and disclose all purchase and redemption fees.
Reserve of Assets: Issuers would be required to maintain daily reserves in the reference currency with a market value at least equal to the value of outstanding stablecoins. Reserve assets would be limited to specified high-quality liquid assets. Reserve assets generally could not be pledged or otherwise encumbered, subject to limited exceptions. The reserve assets would also need to be held with a Canadian-incorporated qualified custodian in a segregated, insolvency-protected account used exclusively for redemption purposes. As a practical matter, the Canadian-incorporation requirement would preclude issuers from using a custodian that is incorporated outside Canada, other than as a sub-custodian of the Canadian-incorporated qualified custodian.
Policies: Issuers would be required to maintain governance, risk management, data security, and recovery and resolution policies, with a designated senior officer responsible for each. Policies would be reviewed annually and before specified changes, with plain-language summaries published in English and French. Risk management and data security policies would also require an independent review every three years.
Reporting and Regulatory Notifications: Issuers would be subject to monthly reporting requirements, including a certified accountant’s opinion on specified reserve matters. At the Bank of Canada’s request, an issuer would also need to provide a lawyer’s opinion concerning compliance with requirements governing the custody and encumbrance of reserve assets. Issuers would also be required to notify the Bank of Canada of incidents and significant changes.
Recordkeeping: Issuers would be required to retain sufficient records to demonstrate compliance with the SCA and the Regulations for up to five years and take reasonable measures to protect those records against loss, destruction, falsification, inaccuracies and unauthorized access or use.
Penalties: Contraventions of the SCA and the Regulations could be classified as serious or very serious and could attract administrative monetary penalties of up to $1 million and $10 million, respectively. A series of two or more serious violations identified in a notice of violation could be treated as a single very serious violation. In determining the penalty amount, the Bank of Canada would consider the actual or potential harm caused, the person’s violation history during the preceding five years, and the degree of intention or negligence. Failures to maintain adequate reserve assets or redeem stablecoins at par would constitute very serious violations.

Extending the RPAA Framework to Stablecoin Payments

The proposed RPAR amendments would bring PSPs performing payment functions using prescribed stablecoins within the RPAA framework. Depending on their activities, these PSPs could become subject to registration, safeguarding, operational risk management, incident reporting and regulatory reporting requirements.

Prescribed stablecoins would include those issued by entities on the Bank of Canada’s registered issuer list, as well as those issued by certain financial institutions subject to federal, provincial or foreign requirements substantially similar to the SCA. Financial institutions issuing the stablecoins would not become subject to the RPAA or RPAR solely by issuing prescribed stablecoins. Existing entity-based exemptions, including those applicable to prudentially regulated financial institutions and activity-based exemptions under the RPAA would continue to apply.

PSPs holding prescribed stablecoins for end users would be subject to specific safeguarding requirements. The amendments would introduce a new safeguarding option under which stablecoins could be held through a separate entity whose sole purpose is holding end-user funds, provided that the arrangement prevents the assets from forming part of the PSP’s estate in an insolvency. PSPs would also be required to maintain written safeguarding frameworks that are independently reviewed every three years, reported on annually to the Bank of Canada and provided to the Bank of Canada on request, with new procedures addressing prompt access to funds, including redemption of stablecoins, and legal and operational risks if the stablecoin issuer becomes insolvent.

PSPs handling prescribed stablecoins would also be required to notify the relevant issuer without delay of material operational incidents and report the value and volume of electronic funds transfers involving prescribed stablecoins. In addition, the RPAR registration requirements would be expanded to capture further ownership, governance and management information for national security purposes. These enhanced information requirements would apply to all PSP applicants, including those that facilitate only fiat payments.

Implications for Issuers and PSPs

The Regulations, together with the SCA, introduce a new compliance architecture for stablecoin issuers operating or seeking to operate in Canada. Issuers would need to assess whether their reserve, custody, redemption, governance, risk management, data security and distribution arrangements satisfy the proposed federal requirements. Issuers would also become subject to direct Bank of Canada supervision, including registration and ongoing compliance obligations. Restrictions on paying yield or interest tied to holding a stablecoin and marketing representations may require issuers to reconsider their product structures, reward programs, customer terms, distribution arrangements and marketing practices.

The RPAR amendments would also expand the reach of federal payments regulation. PSPs performing payment functions using prescribed stablecoins would need to determine whether their activities fall within the RPAA framework and, if so, whether their safeguarding, operational risk, incident response, reporting and insolvency arrangements meet the applicable requirements.

The amendments may be particularly significant for PSPs already registered under the RPAA whose stablecoin-related activities have not previously been treated as regulated payment functions. These PSPs would need to reassess their existing products and transaction flows and may need to update their Bank of Canada registration information and extend their safeguarding, operational risk, incident response and reporting frameworks to cover prescribed stablecoin activities. Businesses whose only Canadian payment activities involve stablecoins should also assess whether the amendments would bring them within the RPAA framework for the first time.

Federal and Provincial/Territorial Interplay

The federal announcement acknowledges the existing role of provincial and territorial securities regulators in overseeing stablecoins (which fall within the broader category of value-referenced crypto assets or VRCAs used by the Canadian Securities Administrators (CSA)), stating that stablecoins are currently subject to the regulation of crypto-asset trading platforms by the members of the CSA. The CSA have expressed the view that VRCAs may constitute securities and/or derivatives in several Canadian jurisdictions. Under the interim approach set out in CSA Staff Notice 21-333 Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients, registered crypto asset trading platforms and platforms that have provided pre-registration undertakings may, with the requisite regulatory consent and subject to applicable terms and conditions, permit clients to buy or deposit certain fiat-backed VRCAs. Based on the undertakings entered into by issuers of stablecoins with the CSA and the exemptive relief recently granted by the CSA in respect of stablecoins, we view the CSA’s oversight as extending beyond trading on registered crypto asset trading platforms.

Beyond issuer undertakings relating to USDC and QCAD, the recent prospectus-qualified offering of CADC tokens by CADC Reserve Trust, together with time-limited exemptive relief granted to the Trust and Loon Payments Inc., its administrator and servicer, illustrates the application of securities regulatory requirements at the issuer and distribution levels. The CSA have also granted time-limited dealer registration relief to businesses operating under an immediate-delivery model, including zerohash llc and Paytrie AB Inc., to transact in certain VRCAs. The VRCA-related relief is limited to “Specified VRCAs,” as defined in the applicable decisions, and remains subject to conditions governing the eligible tokens and the dealer’s activities. Immediate delivery does not, by itself, resolve the securities law treatment of the underlying VRCA. As a result, the proposed federal framework will operate alongside the existing provincial securities regulatory regime, potentially raising questions regarding the interaction between federal and provincial/territorial authority over stablecoins.

As a result, issuers and intermediaries should not assume that registration with the Bank of Canada would, by itself, satisfy requirements relating to the distribution or trading of a stablecoin. A key implementation question is how federal registration and supervision will interact with existing issuer undertakings, prospectus requirements and exemptive relief, particularly where reserve, custody, redemption and disclosure obligations overlap. Further coordination and guidance would help clarify whether existing requirements will be maintained, modified or replaced as the federal regime takes effect.

What’s Next and How to Prepare

The federal government is targeting fall 2027 for implementation of the regime. The Regulations would take effect on the date(s) set by the Governor in Council for the relevant SCA provisions.

Transitional Relief: Issuers already issuing stablecoins immediately before the SCA takes effect could benefit from transitional relief from prior registration by applying to the Bank of Canada within 30-days after the SCA comes into force. Such issuers could generally continue issuing while their applications are considered but would need to stop if that application is refused. Existing issuers that miss the 30-day deadline would not qualify for this relief.

While the proposals remain open for consultation, stakeholders should consider commenting on potential legal, operational or implementation challenges and begin preparing by reviewing their existing structures, products and processes against the proposed framework in the following ways:

Issuers should review reserve, custody, redemption, governance and reporting arrangements against the proposed requirements.
PSPs should identify stablecoin activities that could fall within the RPAA and assess any needed updates to registration information and compliance frameworks.

As Canada’s stablecoin framework takes shape, BLG can help you assess the implications for your business, respond to the consultation and prepare for implementation.

The 2026 federal budget: Great expectations

Tue, 03 Nov 2026 00:00:00 Z

The Canadian business community awaits the 2026 federal budget with heightened expectations. In The Globe & Mail, I described the Productivity Mega Deduction announced on Sept. 15 as “the most consequential Canadian tax policy initiatives of the 21^st century”, and it is, both for the impact of the tax change itself and for what it represents. In the government’s own words, this measure constitutes “a sea change in how Canada intends to stimulate business investment decisions.” That’s a major change in Canada’s historically passive tax policy and exactly what it should be doing in these circumstances: actively supporting our larger economic strategy and expanding our tax base (which funds the social programs we want), not just passively taking a cut of whatever’s there.

Countries whose economies are susceptible to coercion (or “economic force”) will find it very difficult to conduct themselves as truly sovereign nations, as recent events demonstrate. Indeed, as I argued recently, tax policy is both an essential ingredient of a strong economy and an expression of our sovereignty.

If we’re going to preserve our sovereignty and compete with other countries for the people and businesses that our economy and our tax base need, getting our tax policy into the game in a major way is essential. In the present environment of aggressive recent tax (and trade) measures from the U.S., a more neutral “a buck is a buck approach simply isn’t feasible. We need to use our tax policy to create the winning conditions to attract the new businesses we want and keep the ones we have. This government seems to understand that, and for that reason I am optimistic the 2026 federal budget will reflect this new activist turn in tax policy.

How the change to a more aggressive tax policy manifests itself in the budget remains to be seen, but there are a variety of ways in which it could. At the macro level, comprehensive tax reform is long overdue in Canada, and the chorus for getting on with this is only getting louder. Leading economists, academics and business organizations such as the Canadian Chamber of Commerce and CPA Ontario have all called for a full review and redesign of Canada’s tax system (not just income tax). It has been three years since I lamented, “Canada’s tax regime weighs on the economy – if not now, when do we reform it?” The 2026 federal budget should at least start what will be a multi-year journey down that road to a more efficient, more competitive tax system. If nothing else, getting top-end personal tax rates down below 50per cent and lowering corporate rates can be funded by increasing sales taxes, which are a better way to raise money.

In terms of specific measures, the Department of Finance conducted a consultation in 2024 on the possibility of introducing a patent box regime for income from intellectual property (IP). The Liberals included this proposal in their election platform, and we should expect to see action on this measure in the upcoming federal budget 2026. Another candidate for stimulative tax measures that would have a meaningful impact is the innovation sector, where there are various ways the tax system could lend more support and the Liberal platform also proposed specific initiatives. As I have said elsewhere, historically our timid tax policy reflects our minimal appetite for economic risk. In general, we need measures that better incentivize risk-taking, such as capital gains relief for entrepreneurs and early-stage investors comparable to what the U.S. offers. Hopefully the government’s policy “sea change” includes more such measures in Budget 2026.

The other theme that should be reflected in the 2026 budget is simplicity, particularly in the income tax sector. Over half a century our Income Tax Act has indeed become a Frankenstein’s monster where “Nothing ever comes off, just new stuff gets bolted on.” There are far too many provisions in the statute that don’t actively support our economic strategy (many of the Organization for Economic Co-operation and Development (OECD) fall into this category), fail to achieve their intended objectives (various boutique personal tax credits, for example), or simply reflect poor cost/benefit choices: the excessive interest and financing expenses limitation rules tick all three of these boxes. These need to be pared back (along with corresponding measures on the tax compliance side), to produce a tax system that is less costly for taxpayers to comply with and for governments to administer: a win-win result. To do this meaningfully will take time, but there are some obvious candidates for immediate action, such as moving to a full exemption system for income earned by foreign subsidiaries of Canadian corporations, which would involve minimal tax revenue loss.

A stronger, more robust economy is absolutely central to a stronger, more robust Canada. Supportive tax policy can be a major contributor to this initiative, and hopefully we will see this featured prominently on Nov. 5, 2026.

Bergeron v. Telus: Superior Court clarifies consumer exploitation and abusive clauses under section 8 CPA

Fri, 30 Oct 2026 00:00:00 Z

On Aug. 18, 2026, the Honourable Marie-Christine Hivon of the Superior Court dismissed the class action brought against Société Telus Communications Inc. (Telus) in Bergeron v. Société Telus Communications Inc.

The plaintiff argued that international roaming charges of $0.60 for receiving SMS messages while abroad were disproportionate to the value of the service and constituted consumer exploitation within the meaning of section 8 of the Consumer Protection Act (CPA). She also alleged that the clauses permitting those charges were abusive within the meaning of article 1437 of the Civil Code of Québec (CCQ).

This decision is particularly significant because it is one of the few to analyze the application of section 8 of the CPA. It clarifies that a consumer must establish, through comprehensive economic evidence, a substantial disproportion between the parties’ respective obligations. In the context of a multidimensional contract, that disproportion must generally be assessed on the basis of the contract as a whole, rather than by examining a single contractual component in isolation.

Analysis

The contract must be assessed as a whole

The Court noted that a claim under section 8 of the CPA may be based on subjective or objective lesion. In this case, the alleged objective lesion required the plaintiff to establish a disproportion between the parties’ respective obligations that was so substantial as to seriously prejudice the consumer.

To establish this disproportion, the plaintiff sought to isolate the service of receiving SMS messages while abroad and compare its price with competitors’ rates, or with the cost of providing that service alone. According to the Court, such an analysis would be inconsistent with section 8 of the CPA, since it requires the Court to consider all the obligations under the contract.

Indeed, in the context of a wireless services agreement, the contested service forms part of a broader multidimensional contract involving interdependent obligations. Accordingly, the disproportion must be assessed by considering the parties’ respective obligations under the contract as a whole, rather than any individual charge or service in isolation.

A price comparison is not sufficient

The Court further noted that the existence of a disproportion may be established either by the market value of the parties’ respective obligations or by their actual value to the merchant, particularly through evidence of the merchant’s costs and resulting profit margin.

However, a substantial disproportion cannot be established through a simple price comparison or on the assumption that the marginal cost of a service is low. Rather, the plaintiff must present sufficiently comprehensive economic evidence to permit a concrete assessment of the value of the obligations at issue, the costs incurred by the merchant, and the resulting profit margin. In the absence of such evidence, it is not possible to find a substantial disproportion or to trigger the presumption of exploitation under section 8 of the CPA.

Comment

The Bergeron decision provides important guidance on the application of section 8 of the CPA in the context of multidimensional contracts. Beyond dismissing the class action, the Court confirmed that a plaintiff cannot establish objective lesion by limiting the analysis to a single charge or service considered in isolation. Rather, the plaintiff must present a structured body of evidence regarding the value of all the contractual obligations, including the merchant’s costs and profit margin.

This decision could have significant implications for claims involving ancillary charges or complex pricing models, particularly in the telecommunications and financial services sectors.

The decision does not, however, create immunity for ancillary charges or usage-based services. The action was dismissed for lack of sufficient evidence, and the Court of Appeal has previously noted, at the authorization stage, that a low price for one service does not preclude a finding that the price of another service within the same contract is lesionary.

Bill C-41: Proposed changes to medical assistance in dying laws

Wed, 28 Oct 2026 00:00:00 Z

The federal government recently introduced Bill C-41, the Medical Assistance in Dying Safeguards Act. Through Bill C-41, the government proposes to permanently prohibit MAiD for those whose sole underlying medical condition is a mental illness, allow practitioners, in certain circumstances, to provide MAiD to those who have made advance requests for MAiD and update reporting requirements for practitioners.

Background

MAiD has been legal since 2016, and access was expanded in March 2021 through Bill C-7. Bill C-7 established different procedural requirements for persons whose natural death is reasonably foreseeable and for those whose natural death is not reasonably foreseeable. (BLG published a bulletin on this topic in 2021 available here.)

Through Bill C-7, the Criminal Code was amended to include a time-limited prohibition on the availability of MAiD for an individual whose sole underlying condition was a mental illness.

Prohibiting MAiD for mental illness

In tabling Bill C-41, the federal government has accepted the 2026 recommendation of the Special Joint Committee on Medical Assistance in Dying and has proposed to permanently prohibit MAiD for individuals whose sole underlying medical condition is a mental illness.

Advance requests for MAiD

If enacted, Bill C-41 would permit MAiD to be provided on the basis of an advance request in certain circumstances. An advance request allows an adult who suffers from a disease that may affect their capacity in the future to set out, while they still have capacity to consent, the circumstances in which they would want to receive MAiD.

Bill C-41 proposes eligibility requirements for the person making an advance request for MAiD, safeguards for the practitioner providing MAiD on the basis of an advance requests and criteria for the preparation and contents of the advance request.

Importantly, Bill C-41 does not propose to enable uniform access to advance requests for MAiD across Canada. Rather, if enacted, Bill C-41 would require that MAiD on the basis of an advance request may only be provided in a province that has laws that identify a repository, or storage system, for advance requests and that govern the creation, submission, and withdrawal of an advance request, among other things. It would be open to provinces and territories to decide whether to establish the required regime to permit MAiD by advance request.

Criteria for the advance request

Bill C-41 provides that a practitioner may only provide MAiD on the basis of an advance request if the advance request met certain criteria and was stored in an eligible provincial or territorial repository. The bill proposes the advance requests could only be stored in the repository if the criteria were met. The proposed criteria include that:

Before the request was signed, the person must have been diagnosed with a serious and incurable illness or disease that was reasonably expected to lead to an irreversible loss of their capacity to consent to MAiD.
The advance request must outline the “observable clinical manifestations” related to the person’s illness that they anticipate would cause enduring and intolerable suffering and for which they would want to receive MAiD. In the advance request, the person must give informed consent to receive MAiD if they lose capacity to consent as a result of the illness or disease and exhibit the clinical manifestations described in the request.
The advance request must be prepared with the assistance of a medical or nurse practitioner. Before the advance request is signed, the person would need to have been informed of the nature of their diagnosis, the expected trajectory of their illness, their prognosis, the means available to relieve their anticipated suffering and the possibility that the means available may be different in the future. If the practitioner did not have expertise in the illness or disease, the person would be required to consult with a practitioner who did. The person must have been informed how to withdraw, amend, or replace the request.

Criteria for providing MAiD by advance request

Bill C-41 includes the following eligibility criteria that would need to be met before a practitioner could provide MAiD by advance requests. The person must:

Be eligible for health services funded by a government in Canada;
Have irreversibly lost, as a result of the serious and incurable illness or disease with which they were diagnosed and in respect of which they made the request, the capacity to consent to receiving medical assistance in dying;
Be exhibiting on a recurring basis the clinical manifestations that they described in the request;
Be in an advanced state of irreversible decline in capability; and
Be experiencing enduring and intolerable physical or psychological suffering that cannot be relieved through reasonable means.

The existing requirement that two independent practitioners confirm that an individual meets the eligibility criteria would apply for MAiD by advance request.

Bill C-41 proposes that a practitioner would not be permitted to provide MAiD on the basis of an advance request if the individual demonstrates refusal or resistance through words, sounds or gestures. Where there is doubt or uncertainty as to whether there was refusal or resistance, MAiD would not be permitted to be administered within 30 days, after which the medical practitioner would be permitted to attempt to administer MAiD again, provided the criteria are still met.

Updated reporting requirements

Bill C-41 proposes to remove reporting requirements for practitioners performing preliminary eligibility assessments for MAiD. The government also intends to allow other professionals to assist practitioners with reporting. Finally, there are proposed amendments to expand data collection on advance requests for MAiD.

Future developments

At present, Bill C-41 has only been introduced in Parliament. Bill C-41 will need to pass through the House of Commons and Senate if it is to become law. BLG will continue to monitor the progress of Bill C-41 and related provincial and territorial developments. If you have questions about Bill C-41 or how the proposed changes may affect your organization, please reach out to any of the key contacts listed below.

The new front line: Why defence sector disputes are changing

Wed, 28 Oct 2026 00:00:00 Z

As geopolitical uncertainty grows, governments are reassessing their defence priorities and increasing military investment. Last March, the Government of Canada announced that it had met NATO’s spending target on defence of 2 per cent of the GDP, bringing Canadian defence expenses to more than $63 billion for 2025 to 2026¹. Canada has now committed to NATO to increase its defence spending to 4 per cent of GDP by 2030 and 5 per cent by 2035, which would represent annual spending of approximately $163 billion.²

With defence investment expected to continue rising, the sector is poised for significant growth. But increased spending is only part of the story. The disputes arising in the defence sector are also changing, increasingly shaped by geopolitical tensions, multi-jurisdictional supply chains, state involvement, national-security considerations and emerging technologies.

Why are the amount and nature of the disputes changing?

As the defence sector undergoes rapid structural and technological change, its dispute landscape is evolving. Geopolitical instability, rearmament initiatives and increased defence spending are driving new procurement activity, while increasingly complex and decentralized supply chains create additional points of friction. Defence companies are also relying more heavily on international partnerships, joint procurement initiatives and cross-border suppliers. At the same time, new entrants—including companies specializing in defence technology, artificial intelligence and cybersecurity—are bringing new capabilities, business models and risks into the sector.

These developments are changing not only the number of disputes, but also their complexity. Defence disputes increasingly involve multiple parties, contracts and jurisdictions, and may give rise to claims involving force majeure, change in law, sanctions and export controls. Intellectual property, technology integration and cybersecurity obligations can add further layers of contractual and regulatory risk. Disruptions to the supply of critical components or ammunition can lead to disputes over delays, cost escalation, contractual performance and responsibility across interconnected supply chains. Similarly, changes in military priorities can require joint ventures and other international partnerships to adapt existing contractual arrangements. The sensitive nature of the information underlying many of these disputes can add a further layer of complexity, particularly at the document disclosure stage, where parties may face obstacles in obtaining relevant information from the opposing party or producing evidence needed to support their position.

The result is a dispute landscape that looks markedly different from the traditional delivery, performance or warranty dispute.

Arbitration as the preferred method for resolving defence-sector disputes

Arbitration remains particularly well suited to defence-sector disputes because of the confidentiality and neutrality of the arbitral process, the availability of specialist decision-makers and its flexibility in cross-border disputes. Confidentiality is often one of arbitrations’ biggest attractions in this sector, where disputes may involve classified information, sensitive technologies, defence capabilities and commercially valuable know-how.

However, confidentiality is not automatic and does not necessarily extend to related court proceedings. This is particularly important in the defence sector, where sensitive information may need to be addressed not only in the arbitration itself, but also in enforcement proceedings, set-aside applications and requests for interim measures. Confidentiality should therefore be considered throughout the lifecycle of a dispute, rather than treated as a feature of the arbitration alone.

State and international organisation counterparties create additional challenges

States and international organisations are also playing an increasingly prominent role as counterparties in defence procurement, with NATO, in particular, becoming a more significant participant.³ Given its immunity from national court proceedings⁴, arbitration may be the only practical avenue for resolving certain contractual disputes involving the alliance. Similar considerations may arise where the counterparty is a foreign state, a ministry of defence or a state-owned entity.⁵

The challenges do not necessarily end when an award is rendered. Enforcement against a state or state-related entity can raise complex questions of sovereign immunity, the assets against which enforcement may be sought and the jurisdictions in which recovery may be pursued. In other words, obtaining an award and recovering amounts due under it are two distinct exercises. Recent decisions concerning the enforcement of arbitral awards against states underscore this distinction. In 2026, for example, the UK Supreme Court confirmed that Spain and Zimbabwe could not rely on sovereign immunity to resist recognition and enforcement of ICSID awards, while preserving the separate question of immunity from execution against state assets.⁶

Emerging legal battlegrounds

The next generation of defence-sector disputes may look very different from traditional procurement disputes. The use of artificial intelligence, for example, is one factor driving this shift. In February 2026, a dispute emerged between Anthropic and the U.S. Department of Defense over restrictions on the military use of artificial intelligence. Anthropic sought to restrict certain uses of its Claude model, including its use in fully autonomous weapons, while the Department raised concerns that overly rigid restrictions could interfere with military operations. The dispute, which led to the Pentagon excluding Claude artificial intelligence models from its supply chain⁷, illustrates emerging questions around contractual rights, operational restrictions, liability and the regulatory framework applicable to AI in the defence sector.

The increasing use of dual-use technologies presents similar challenges. Technologies developed for civilian applications may subsequently be incorporated into defence programmes, creating additional contractual, regulatory and export-control considerations. Governments may also seek greater access to technical data and other technology, while contractors seek to protect proprietary technology and intellectual property.

These issues are likely to generate disputes not only over performance and delivery, but also over who controls the technology, how it may be used and transferred, and how regulatory or military requirements may affect the parties’ contractual rights.

Practical takeaways

In defence contracts, the dispute-resolution clause should be viewed as part of the broader risk-allocation architecture, rather than as boilerplate. In-house counsel and contractors should consider, at the contracting stage, questions such as:

Does the dispute-resolution clause adequately address confidentiality requirements?
Have potential enforcement and immunity issues been considered where the counterparty is a state or international organisation?
Are arbitration clauses aligned across prime contracts, subcontracts and related project agreements?
Who owns the intellectual property, technical data and improvements developed during the project?
Does the contract adequately address sanctions, export controls and regulatory change?

Defence-sector disputes are becoming more international, technology-driven and legally complex. Although arbitration remains particularly well suited to many of these disputes, parties should consider their dispute-resolution strategy when allocating contractual risks—not only once a dispute arises. As defence investment grows and the sector evolves, anticipating how and where disputes may arise will be an increasingly important part of managing those risks.

Just and equitable liquidation and dissolution: a remedy for shareholder disputes

Fri, 23 Oct 2026 00:00:00 Z

Shareholder disputes can destabilize a company. They often paralyze the decision-making process and impair governance. When shareholder disputes arise, the courts are often asked to intervene. While many parties turn to the oppression remedy under s. 227 of the Business Corporations Act (BCA), which was discussed in our December 2024 article on the oppression remedy, British Columbia courts have another powerful tool at their disposal: the “just and equitable” liquidation and dissolution remedy under section 324 of the BCA. This remedy plays a central role in resolving shareholder deadlock, loss of substratum, and breakdowns in closely held companies.

The just and equitable test: a lower threshold

The “just and equitable” test under s. 324 represents a lower threshold compared to the oppression remedy under s. 227.¹ Under s. 324 there is no requirement of a finding of oppression, unfairly prejudicial conduct or even wrongdoing. Thus, in many cases, this makes it relatively easier for a complainant to obtain a remedy.

Flexibility of the just and equitable test and the court’s discretion

The just and equitable test itself is a flexible standard, designed to adapt to a wide range of circumstances.² This flexibility allows the court to make decisions that reflect the unique nature of each case, while still respecting necessary safeguards against overly liberal applications of the remedy. For example, what is considered “just and equitable” in the context of a family business may differ from a conventional commercial business. In the family business context, the court may interpret the “just and equitable” standard more liberally to reflect the personal relationships involved.³

When determining whether a declaration of liquidation and dissolution is “just and equitable”, the court focuses primarily on the reasonable expectations of the parties involved. It does not require that the company’s affairs be impeded or that the parties involved have acted improperly. Instead, the court considers whether the continuation of the company is consistent with the original intentions of the parties and what is fair in the context of the dispute.⁴

The court has broad discretion to determine whether the liquidation and dissolution is just and equitable.⁵ However, this discretion is not boundless. The remedy cannot be applied so liberally as to render the corporate structure meaningless.⁶ For example, courts may refuse to order liquidation and dissolution if the proceeding appears to be aimed at merely monetizing an individual’s interest in the company, without a legitimate business or fairness concern at its core.⁷ In addition, actual liquidation and dissolution is considered a “drastic remedy”⁸ or one of “last resort.”⁹

Recognized grounds for relief under section 324

There are four recognized grounds that courts have relied on to justify the use of section 324: (a) loss of substratum; (b) justifiable lack of confidence; (c) deadlock; and (d) the partnership analogy.¹⁰ However, the courts have made clear that their discretion under s. 324 is not limited to these categories. The words “just and equitable” have been described as words of the widest significance that confer a broad discretion on the court to make a liquidation order in any circumstances it considers appropriate. Nevertheless, most successful cases fit in one or more of the four categories.

a) Loss of substratum

Loss of substratum happens when the company’s original purpose or core business no longer exists or there is a failure of the fundamental objectives of a corporation.¹¹ For example, if a company was set up to develop a product, but that product is no longer possible to create or sell such that it is impossible for the company to carry on the business, the company may no longer serve a useful purpose and accordingly a winding up order may be just and equitable.¹²

b) Justifiable lack of confidence

Justifiable lack of confidence is a situation where the members of a company lose trust in one another, making it difficult for the company to run effectively. For example, the following situation may lead to finding justifiable lack of confidence amongst the members of a company whose liquidation and dissolution is sought:

Each member believes that the other
- is acting against the best interests of the company to appropriate corporate opportunities for themselves or their relatives.
- is conspiring with family members and outsiders; or
- is involved in some secret deals.¹³

c) Deadlock

Deadlock occurs where the parties are unable to make decisions due to irreconcilable disagreements, effectively paralyzing the company.¹⁴ For example, the court may find deadlock where, notwithstanding their extended efforts to reach an agreement and resolve their dispute through means other than liquidation and dissolution, the members of the company cannot agree on matters such as the value of the underlying properties that were owned by the company, the mechanism they should use to separate their interests, or how to address the tax consequences of certain options.¹⁵

Some of the circumstances that would normally lead to a finding that it is just and equitable to wind up a company because of deadlock are as follows:

there are no other effective and appropriate remedies to resolve the issue between the parties;
there is an equal split or nearly equal split of shares and control;
there is a serious and persistent disagreement as to some important questions respecting the management or functioning of the corporation;
there is a resulting deadlock; and
the deadlock paralyzes and seriously interferes with the normal operations of the corporation.¹⁶

In the same vein, the court may find that it is just an equitable to grant relief under s. 324 because of a deadlock where the directors simply could not agree on anything.¹⁷

d) Partnership analogy

Where the relationship between the parties resembles a partnership more than arm’s length shareholders, courts have been prepared to liquidate and dissolve a company on the same grounds on which the court would wind up a partnership. The equitable intervention of the court on this ground requires the satisfaction of two conditions: (i) the existence of an undertaking that is in substance a partnership in the guise of a private company, and (ii) a breakdown of the mutual trust and confidence upon which the original undertaking was founded.¹⁸

For example, if family members involved in an “incorporated partnership” can no longer get along such that working together in the business is impossible, the court may find it appropriate to order that the company be liquidated and dissolved.¹⁹

A back door to s. 227 remedies

One of the most important features of s. 324 is the ability of the court to make an order under s. 227 instead of ordering that the company be liquidated and dissolved. As discussed in our December 2024 article on the oppression remedy, s. 227 remedies include the following:

directing an issue or exchange of shares;
ordering the company or any other person to purchase part or all the shares of a complainant;
ordering compensation for an aggrieved person;

For example, on an application under s. 324, the court could order that the company or another shareholder purchase the complainant shareholder’s shares, instead of making a winding up order. For that reason, s. 324 may be described as a “back door” to the oppression remedy.

Key takeaways

The just and equitable liquidation and dissolution remedy under section 324 of the British Columbia Business Corporations Act is an important tool for resolving shareholder disputes. Courts are guided by fairness principles and the reasonable expectations of the parties, with the court exercising broad discretion to ensure that the remedy is only applied when truly necessary, often when there is a loss of substratum, justifiable lack of confidence and deadlock.

Supreme Court of Canada clarifies law of causation in long-awaited Hemmings v. Padmore decision

Fri, 23 Oct 2026 00:00:00 Z

How should litigants and trial judges approach the causation analysis in negligence cases?

In Hemmings v. Padmore, 2026 SCC 34, released on October 23, 2026, the Supreme Court of Canada clarified and restated the law of causation in negligence cases, including complex medical negligence cases. The decision underscores the distinct roles of factual causation and remoteness and the need to address each separately in the causation analysis.

BLG is proud to have represented HIROC and the hospital in successfully responding to this appeal. The BLG team included Cindy D. Clarke, Kirsten Crain, Daniel Girlando, Alysha Flipse, and others.

Key takeaways

Causation entails two distinct inquiries: factual causation and remoteness are separate inquiries.
The language of “legal causation” (and related terms such as “proximate cause”, “proximity” or “cause-in-law”) is consigned to the “dustbin of history” – the correct term is remoteness.
Factual causation asks whether the defendant’s breach caused the injury as a matter of fact. Under the usual “but for” test, the plaintiff must establish on a balance of probabilities that the injury would not have occurred had the defendant met the standard of care. This counterfactual analysis asks whether appropriate care would have avoided the injury, not merely changed the sequence of events.
Remoteness asks whether there is a sufficient connection between the defendant’s wrongful conduct and the plaintiff’s injuries such that the defendant should be liable. This inquiry can limit legal responsibility, even where there is factual causation.
The remoteness inquiry is context-specific and rooted in corrective justice. It asks whether there was a “real risk” of harm, which requires the court to consider whether the risk is one that a reasonable person ought to have foreseen and taken reasonable precautions to prevent.

Background

Sophia Hemmings suffered a cardiac arrest following anesthetic complications during an emergency caesarean section and sustained severe, permanent brain damage. She and her family sued the hospital and several healthcare providers involved in her care, including Dr. Padmore, the obstetrician who treated her during much of her pregnancy; Drs. Peng and O’Brien, the obstetricians involved in her care around the delivery; and Dr. Jamensky, the anesthesiologist who administered general anesthesia during the operation. The claim against the hospital included vicarious liability for the alleged negligence of a nurse, who provided telephone advice to Ms. Hemmings 12 days before the cardiac arrest.

The trial judge found the hospital, Dr. Padmore, who provided prenatal care, and Dr. Jamensky, the anesthesiologist, liable. The Court of Appeal set aside the findings of liability against the hospital and Dr. Padmore but upheld the judgment against Dr. Jamensky.

Supreme Court dismisses the appeal and clarifies causation

The Supreme Court, in a divided decision involving three sets of reasons, dismissed both the family’s appeal and Dr. Jamensky’s appeal, confirming that the hospital and Dr. Padmore were not liable, while upholding the finding of liability against the anesthesiologist, Dr. Jamensky.

The majority reasons were penned by Justices Rowe and O’Bonsawin (with Justice Jamal concurring). Justice Martin (with Justices Karakatsanis and Moreau concurring) agreed with the majority’s disposition of Dr. Jamensky’s appeal, but dissented in part on the family’s appeal, and would have restored liability against Dr. Padmore. Chief Justice Wagner agreed with the majority’s disposition of the family’s appeal and specifically endorsed the majority’s statement of the law relating to factual causation and remoteness, but would have allowed Dr. Jamensky’s appeal.

Clarifying causation

The decision reinforces that a successful plaintiff must prove both that the defendant’s breach of the standard of care was the factual cause of the damages (“factual causation”), and that the injuries are not too remote from the defendant’s conduct to assign liability (“remoteness of damage”).

Factual causation ordinarily asks whether, on a balance of probabilities, the injury would have occurred but for the defendant’s negligent conduct. This is a “strictly causal” question. The defendant’s conduct must be a necessary, but not necessarily the sole cause, of the plaintiff’s injury. In complex cases, the court may need to engage in an explicit counterfactual analysis to determine if the injury would have occurred even if the defendant’s conduct had not fallen below the standard of care. However, in other, simpler cases, it may be inferred from a finding of factual causation that the trial judge rejected the counterfactual. The majority acknowledged that medical negligence cases often raise complex medico-legal causation issues, which would require the trial judge to offer more explicit analysis.

Remoteness, previously referred to as legal causation, asks whether the injury suffered was a reasonably foreseeable consequence of the breach. This is a normative inquiry, which asks if there is a sufficient connection between the defendant’s wrongful conduct and the plaintiff’s injuries for the defendant to be liable.

All members of the Court agreed that these are two distinct inquiries, and that going forward, the latter inquiry should be referred to as “remoteness”. The Court discarded previously used terms, such as “legal causation”, “proximate cause”, “proximity”, or “cause-in-law”.

Guiding principles for the remoteness analysis

The majority set out three guiding principles for the remoteness analysis. First, a negligent defendant can only be liable for those consequences that they could have reasonably foreseen at the time of their breach. Second, there must have been a real risk or probability that the type of injury could occur such that a reasonable person would have taken reasonable precautions to prevent it. Third, although the defendant need not have foreseen the precise sequence of events leading to injury, the type of accident or incident must have been foreseeable. The focus must remain on the actual injury suffered by the plaintiff.

The Court emphasized the corrective justice orientation of all tort law, including negligence. The remoteness inquiry ensures that a defendant is only liable for the plaintiff’s injuries “if the probability that those injuries would occur was something the defendant ought to have considered and taken precautions to prevent”. This is a context-specific inquiry, which will be driven by both the degree of harm that is foreseeable and the costs associated with preventing the risk of that harm. Remoteness is not applied to address public policy concerns.

While the remoteness inquiry has been described as demanding value judgments, the majority confirmed that it is not merely a matter of fairness and public policy, and rejected the Hemmings family’s arguments that liability can be determined on the basis of general policy considerations. This would introduce unacceptable uncertainty into the analysis.

The role of reasonable foreseeability in the negligence analysis

While reasonable foreseeability plays a significant role in the remoteness inquiry, this concept also plays a role in establishing whether the defendant owes the plaintiff a duty of care.

The majority clarified that while the concept of reasonable foreseeability is applied at both the duty of care and remoteness stages, it plays a different role in each inquiry. At the duty of care stage, the focus is on the type of harm and class of plaintiff. In contrast, at the causation stage, the focus is on whether there is a sufficient connection between the defendant’s wrongful conduct and the particular injury suffered by the plaintiff.

Scope of the reasonably foreseeable harm

The Court also grappled with how to define the injury that must be reasonably foreseeable for the purposes of the remoteness inquiry.

The majority observed that describing the injury too broadly (such as risk of “physical injury”) or too narrowly is improper. The former would risk creating unlimited liability, while the latter would risk immunizing defendants from liability.

In the context of this case, the majority characterized Ms. Hemmings’ injuries as those resulting from anesthetic complications, namely, cardiac arrest and the resulting brain injury. The majority rejected the family’s argument that all that needed to be reasonably foreseen was “physical injury”. This would cast the net too wide, and result in defendants being held liable for virtually all consequences, regardless of whether there was a real risk of that consequence occurring.

Application: All judges agreed the hospital should not be held liable, but disagreed with respect to the liability of the physicians

Applying the legal principles, the Court unanimously dismissed the appeal involving the hospital, with all seven judges agreeing that the hospital should not be held liable.

The majority held that the trial judge erred in assessing whether the hospital was a factual cause of Ms. Hemmings’ injuries, and that given the indirect relationship between the nurse’s negligent conduct and Ms. Hemmings’ injury, suffered 12 days later, the trial judge was required to address the counterfactual directly. The majority also found that the trial judge erred in the remoteness inquiry by failing to reconcile his findings that Ms. Hemmings’ injuries were reasonably foreseeable to the nurse and to Dr. Padmore, but not to Dr. O’Brien, an obstetrician who conducted Ms. Hemmings’ caesarian section, and who had more information regarding Ms. Hemmings’ risk factors than either Dr. Padmore or the nurse. In the majority’s view, these findings were logically inconsistent.

Justice Martin agreed that the injuries suffered by Ms. Hemmings did not fall within the scope of the risk created by the nurse’s negligence, and so it was not possible to find the hospital liable in negligence.

The Court was more divided in its assessment of the claims against the physicians. With respect to Dr. Padmore, the majority held that the expert evidence did not support that the risk of anesthetic complications arising from obesity (one of Ms. Hemmings’ risk factors) were reasonably foreseeable, with two experts testifying that they would not inform a pregnant patient of the risks of anesthetic complication. In contrast, Justice Martin found that Ms. Hemmings’ injuries were a “pregnancy-related risk” that were not too remote, such that Dr. Padmore ought to have been liable. She held that Dr. Padmore’s negligence, in failing to discuss Ms. Hemmings’ high risk factors and the possibility of terminating the pregnancy, created a broad scope of risk that Ms. Hemmings’ elevated pregnancy-related risk factors (including the risk of anesthetic complications) would materialize.

With respect to Dr. Jamensky, the majority held that the trial judge’s reasons were sufficient, when reviewed functionally and contextually, and found no error in the judge’s analysis of factual causation. Dr. Jamensky’s negligent act (converting to general anesthetic) was in close temporal proximity and clearly connected to Ms. Hemmings’ injury, and as such an explicit counterfactual analysis was not required. In contrast, Chief Justice Wagner found that the trial judge erred by conflating the factual causation and remoteness analyses, by assessing whether Dr. Jamensky was a “direct cause”, rather than a necessary cause, of Ms. Hemmings’ injuries, and by failing to conduct the required counterfactual analysis.

The split decisions with respect to the liability of the defendant physicians underscore the complexity of conducting a causation analysis, even where the governing legal principles are settled.

Hemmings is a welcome restatement of the law of causation, and will have a far-reaching impact well beyond the medical context.

Ontario Securities Commission (OSC) Investment Management Division Annual Summary Report: Insights from Staff Notice 81-741

Wed, 21 Oct 2026 00:00:00 Z

On Sept. 15, 2026, the Ontario Securities Commission (OSC) published OSC Staff Notice 81-741 Investment Management Division Annual Summary Report (the Staff Notice), summarizing the activities and regulatory focus of the OSC’s Investment Management Division for the fiscal year ended March 31, 2026.

The past fiscal year was defined by accelerating product innovation, a continued shift in investor preferences toward Exchange-Traded Funds (ETFs), and significant movement on long-anticipated policy files, including the modernization of continuous disclosure, liquidity risk management and ETF regulation. The Staff Notice provides a timely overview of the Division’s recent activities and ongoing policy work, while also offering insight into areas that may attract continued regulatory attention.

Below, we highlight the Staff Notice’s main insights and five key action items for Canadian fund managers (IFMs) and advisers.

Emerging product trends

This year’s prospectus activity highlights how innovation continues to reshape Canada’s fund landscape.

Collateralized Loan Obligation (CLO) ETFs: CLO ETFs moved into the mainstream, with the Canadian Securities Administrators (CSA) receipting several AAA-rated CLO ETFs in April 2025. Notably, the CSA determined that investment-grade CLOs are not “illiquid assets” as defined in section 1.1 of NI 81-102, citing the size of the global CLO market (over $1 trillion), growing trading volumes and established secondary markets;
Solana and XRP ETFs: These became the first North American ETFs to provide direct spot exposure to those crypto assets, with Solana ETFs also permitted to stake a portion of their holdings;
Triple leveraged (3x) ETFs: These ETFs received their first Canadian prospectus receipts in 2025, subject to leverage limits, enhanced risk disclosure and investor protection measures; and
Single issuer ETFs: These expanded to include Canadian and certain international issuers through exemptive relief from concentration restrictions, prompting the CSA to propose insider reporting amendments to address potential reporting gaps.

Evolving exemptive relief applications

Custodial relief for crypto asset funds: Relief was granted to permit a U.S. bank to act as sub-custodian for crypto asset funds despite not meeting the NI 81-102 equity threshold, subject to a C$100 million parental guarantee;
International inter-fund trading: Relief was granted to permit Canadian-domiciled reporting issuer funds to purchase debt securities from, or sell debt securities to, related funds in the U.K., Ireland, Luxembourg and Hong Kong. Related relief was also granted permitting Canadian reporting issuer funds, pooled funds and managed accounts to purchase or sell securities to or from those related international funds, expanding cross-border inter-fund trading opportunities within global fund families; and
Coordinated blanket order for the Bank of Canada’s Contingent Term Repo Facility (CTRF): The CSA issued coordinated local blanket orders providing relief from certain repurchase transaction requirements in NI 81-102 to allow eligible investment funds to access the Bank of Canada’s CTRF during periods of severe market-wide liquidity stress. The CSA subsequently published proposed amendments to NI 81-102 that would codify the temporary relief provided under Coordinated Blanket Order 81-930 and extend similar relief to future Bank of Canada repurchase facilities.

Regulatory continuous disclosure reviews

Throughout fiscal 2026, OSC staff undertook a series of focused compliance reviews and surveillance initiatives aimed at identifying disclosure deficiencies, monitoring regulatory compliance and addressing operational risks within the investment fund industry.

Mid-size issuer review: Building on its prior small issuer review, OSC staff expanded its review to IFMs with less than $1 billion in Assets under management (AUM) and identified Management Report of Fund Performance (MRFP) disclosure that was inconsistent with regulatory requirements or insufficiently fulsome, as well as minor issues involving compliance reports and custodian letters, with a follow-up review expected after implementation of the modernized investment fund disclosure regime;
Outlier analysis of Investment Fund Survey data: OSC staff reviewed data collected during its 2024 Investment Fund Survey relating to liquidity, borrowing, short selling and leverage. The OSC found that most outliers were attributable to exemptive relief, classification errors, clerical mistakes or temporary fluctuations and indicated that monitoring will continue;
Change of auditor notification: OSC staff reviewed change of auditor notifications filed under NI 81-106 to assess whether any reportable events or unusual financial statement items may have contributed to the auditor change;
Risk rating corrections: OSC staff identified one manager whose Fund Facts risk ratings for three funds were below the levels prescribed by the CSA methodology, resulting in corrective disclosure filings and placement of the funds on the Refilings and Errors List for three years;
Sales communications: OSC staff reported recurring deficiencies in fund marketing materials, including non-compliant use of ratings, rankings and performance data, and reiterated that such deficiencies may result in corrective disclosure, placement on the Refilings and Errors List or further enforcement action; and
Compliance reports: OSC staff identified recurring deficiencies in compliance and custodian reports relating to the handling of investor cash, including overdrafts, cash commingling and lapping, and emphasized the importance of compliance with the cash handling requirements in Parts 9, 10 and 11 of NI 81-102.

Ownership changes and asset acquisitions involving registered firms (section 11.9 and 11.10 Notices)

OSC staff remind registered firms proposing ownership changes or certain asset acquisitions to ensure that notices under sections 11.9 and 11.10 of NI 31-103 include sufficient information for staff to assess the transaction. Notices must explain how any material conflicts of interest arising from the proposed changes have been or will be addressed in the best interests of clients. Incomplete notices may delay the OSC’s review. Staff also caution that missed notices must be filed with the applicable fees and may result in a warning letter or, in limited cases, further regulatory action. Where a Canadian Investment Regulatory Organization (CIRO) member is involved, directly or through a deemed acquisition, the applicable filing fee may be payable to CIRO rather than the OSC.

Regulatory policy: Modernization moves from proposal to implementation

Completed initiatives

Continuous disclosure modernization (conflicts and financial statements): Final amendments to NI 81-101, NI 81-102, NI 81-106 and NI 81-107 were published Jan. 22, 2026, and took effect April 22, 2026. IFMs must now file the new standardized Form 81-107A Conflict Reporting Form for Related Issuer Purchases, which replaces prior conflict of interest reporting obligations for in-scope related party purchases, and must prepare an annual Manager’s Report on Related Party Transactions under new section 2.5 of NI 81-107, appended to the Independent Review Committee’s (IRC’s) annual report to securityholders;
Crypto asset funds, phase two: Final amendments to NI 81-102 governing public funds investing in crypto assets came into force July 16, 2025, establishing restrictions on permitted crypto investments and enhanced custodial obligations. Phase three, which will consult on further areas of regulatory attention, is ongoing; and
Principal distributor model: Final amendments were published June 11, 2026, clarifying that a principal distributor may act only for mutual funds in the same fund family and introducing enhanced disclosure of principal distributor arrangements and compensation in the prospectus, Fund Facts and annual report on charges and other compensation.

Ongoing initiatives

Access-based model: On Sept. 27, 2022, the CSA published for comment, CSA Notice and Request for Comment - Proposed Amendments and Proposed Changes to Implement an Access-Based Model for Investment Fund Reporting Issuers, intended to modernize delivery of investment fund continuous disclosure documents by making them more readily available online, reflecting growing investor preference for electronic access. Comments on the Sept. 2022 proposal continue to inform a revised proposal, which is expected to be republished in 2026;
Fund Report (MRFP replacement): Following the Sept. 2024 proposals and behavioural insights testing, the CSA is refining a revised, streamlined annual and interim Fund Report to replace the MRFP, to be tested and republished for further comment;
Chargeback prohibition: Proposed amendments published June 26, 2025, would prohibit chargeback arrangements in the distribution of reporting issuer investment funds. The CSA is working toward finalization;
ETF regulation and foreign-listed ETFs: Following the June 2025 ETF Consultation Paper and the concurrent OSC ETF Study, investor access to foreign-listed ETFs emerged as the key area of focus. On July 29, 2026, the CSA and CIRO published Staff Notice 81-339, cautioning that active marketing or promotion of a foreign ETF in Canada could trigger the prospectus requirement and, in some jurisdictions, IFM registration, clarifying applicable dealer conduct obligations, and encouraging order-execution-only dealers to provide point-of-purchase alerts. Managers with foreign affiliates should review Canadian-facing marketing practices carefully; and
Liquidity risk management: On Nov. 27, 2025, the CSA published proposed amendments to NI 81-102 that would formalize liquidity risk management (LRM) frameworks, enhance operational practices including stress testing, and strengthen oversight and governance, alongside a consultation paper on LRM tools, liquidity classification and data reporting. The 120-day comment period closed March 27, 2026, and feedback is under review.

Emerging issues: Long-term assets, cross-border access and expanded data collection

Long-Term Asset Fund Project: Building on Consultation Paper 81-737 and Staff Notices 81-738 and 81-740, the OSC continues to engage with stakeholders on potential retail access to private market investments through new fund structures, with recent discussions focusing on valuation, transparency, liquidity and redemption risks;
Hong Kong Memorandum of Understanding (MoU): Effective May 13, 2025, the OSC and the Securities and Futures Commission of Hong Kong executed an MoU to strengthen cross-border supervision and facilitate market access for Ontario-registered portfolio managers;
IFRS 18: IFRS 18 applies to annual reporting periods beginning on or after Jan. 1, 2027. OSC staff noted that some accounting firms consider IFRS 18 not to permit separate presentation of realized and unrealized gains and losses from financial instruments, while section 3.2 of NI 81-106 requires those amounts to be presented as separate line items. IFMs should engage their auditors in advance regarding an approach that complies with both IFRS and applicable securities law requirements;
Foreign issuer reports of exempt distribution: The temporary exemption from SEDAR+ filing requirements for certain foreign issuer exempt distributions to permitted clients has been extended under OSC Rule 13-513 to Jan. 21, 2028, pending a permanent solution;
Investment Fund Survey expansion: The 2026 Investment Fund Survey has been expanded to include funds managed by IFMs not registered in Ontario, with further enhancements under consideration for 2027; and
Fee rule changes: Proposed amendments to OSC Rule 13-502 and Rule 13-503, would provide fee relief for many market participants and affect prospectus filing and exemptive relief application fees, with the changes expected to come into force on April 5, 2027.

Five key action items for Canadian fund managers

Implement the modernized continuous disclosure requirements: Ensure processes are in place to file Form 81-107A for in-scope related party purchases and to prepare the annual Manager’s Report on Related Party Transactions for inclusion with the IRC report. Update financial statement templates to reflect the streamlined requirements and monitor the forthcoming revised Fund Report proposal, which could replace MRFP.
Audit risk ratings and sales communications: Verify that Fund Facts risk ratings are no lower than prescribed by the CSA methodology and that written policies govern any upward discretion. Review websites and social media channels, including YouTube and LinkedIn, for ratings, rankings and performance claims that do not comply with Part 15 of NI 81-102. Depending on the circumstances, OSC staff may require corrective disclosure or a news release, place affected funds on the Refilings and Errors List for three years or refer continued non-compliance for further regulatory action.
Strengthen cash handling and compliance reporting: Review controls over trust accounts, settlement timing, commingling and lapping risks under Parts 9 to 11 of NI 81-102, and ensure compliance and custodian reports are complete and filed on time in SEDAR+.
Prepare for the liquidity risk management framework: Assess current LRM policies, stress testing and governance against the proposed amendments to NI 81-102.
Assess product and relief opportunities, and cross-border exposure: Consider whether recent precedents, including CLO ETFs, spot crypto ETFs, leveraged and single issuer ETFs, crypto custody relief and international inter-fund trading relief, create opportunities for your product shelf, and use the confidential pre-filing process for novel products. Managers with foreign-listed ETF affiliates should review Canadian marketing practices against Staff Notice 81-339.

Canada’s investment management landscape continues to evolve alongside product innovation and shifting regulatory priorities. BLG’s Investment Management team advises fund managers through every stage of fund formation, structuring and continuous disclosure compliance across alternative products, digital assets and crypto-based products.

For more information, please contact any of the authors below or your usual member of BLG’s Investment Management Group.

A new structure enters the ring: CIRO’s Incorporated Approved Person compensation proposal

Tue, 20 Oct 2026 00:00:00 Z

The Canadian Investment Regulatory Organization’s (CIRO) proposed Incorporated Approved Person model could materially change how client-facing advisors structure their businesses and receive compensation with significant impacts to sponsoring firms. The proposed rule amendments, published on July 9, 2026, would introduce a harmonized incorporated compensation option for client-facing Approved Persons across CIRO regulated dealers. Comments are due November 6, 2026.

CIRO would preserve the existing employee and agent models, and repeal the directed commission option currently available to certain mutual fund dealing representatives.

At a high level, the corporation would need to obtain the appropriate registration, or an exemption from registration, as well as CIRO approval. Under the current proposal, the individual registrant would have to be the sole holder of voting shares; ownership of non-voting shares would be limited to the advisor and certain family members; and activities outside the sponsoring dealer relationship would require advance dealer approval, and would be confined to permitted ancillary or regulated financial services activities.

A written tri-party agreement among the dealer firm, corporation and individual advisor would be required. It would have to address specified matters, including the dealer’s supervisory responsibility; require that all securities and derivatives business for the dealer be conducted through the corporation; and address client disclosure and other compliance obligations.

Amendments to securities legislation and/or to National Instrument 31-103 – Registration Requirements, Exemptions and Ongoing Registrant Obligations would likely be required before advisor corporations could conduct securities-related activities. It remains unclear whether comparable policy work will be undertaken for non-CIRO registrants.

BLG held a webinar on September 22, 2026, to discuss the proposal’s rules on eligibility and ownership, tax considerations, disclosure and implementation issues. For more information, see BLG’s Insight, One step closer to harmonization: CIRO’s proposed Incorporated Approved Person Compensation model (July 23, 2026), or contact your usual BLG lawyer for information from the webinar.

AUM Law Regulatory Update newsletter: Brief news (October 2026)

Tue, 20 Oct 2026 00:00:00 Z

At the CIRO booth: Dealer regulation and compliance developments

Client Focused Reforms guidance

The Canadian Investment Regulatory Organization (CIRO) is developing a series of three targeted compliance bulletins to help Dealer Members and Approved Persons apply the Client Focused Reforms (CFRs) in practice. The bulletins build on Joint CSA/CIRO Staff Notice 31-368 Client Focused Reforms: Review of Registrants’ Know Your Client, Know Your Product and Suitability Determination Practices and Additional Guidance, and respond to recurring deficiencies and areas of uncertainty identified through compliance examinations. The first published guidance focuses on Know-Your-Client obligations and includes practical examples of how to determine risk profile based on a client’s risk capacity and risk tolerance. Future guidance will cover Know-Your-Product and suitability determination obligations.

The guidance is intended to be proportionate to a dealer’s business model, product shelf and client profile. The bulletins can be used to help dealer firms test the sufficiency of their existing processes.

Account transfers and bulk account movements

On July 23, 2026, CIRO published Bulletin 26-0161, Modernization of requirements for account transfers and bulk account movements (IDPC Rule 4800, MFD Rule 2.12 and CIRO Rule 4800), proposing modernized requirements for account transfers and bulk account movements by investment dealers and mutual fund dealers. While CIRO notes that dealer access to additional and more highly automated account transfer facilities protocols is also required to modernize the transfer process, some rule improvements could be made as well.

The proposed revisions to previously published draft amendments clarify that an account subject to a temporary hold cannot be transferred until the delivering dealer removes the hold. They also require delivering and receiving dealers to use best efforts to complete each transfer step as soon as practicable. CIRO has separated the timelines for notifying and acknowledging a transfer request, providing the asset list, and resolving impediments from the subsequent settlement timeline. Once the parties determine that no transfer impediments exist, or that all impediments have been resolved, the transfer must settle within five clearing days. The proposed amendments would also clarify that electronic communications between the dealers must be used where possible.

Extended hours trading

On October 8, 2026, CIRO published Guidance Note GN-3100-26-001, Guidance on Extended Hours Trading (Guidance). The Guidance reminds Dealer Members that extended sessions may involve considerations such as lower liquidity, wider bid-ask spreads and reduced-price discovery from those available during core market hours.

Dealer Members that offer extended-hours trading should ensure that their disclosure, supervision, policies and controls reflect those additional risks. CIRO expects public website disclosure explaining when extended sessions are available, how orders may be handled and executed, and how after-hours trading differs from trading during core market hours. The Guidance also identifies minimum elements for risk disclosure and considerations for best execution policy disclosure such as fragmented liquidity, venue availability and price differences outside core hours.

Enforcement and annual reports

CIRO released its 2025/2026 Enforcement Report on July 22, 2026, and its 2026 Annual Report on September 21, 2026. Together, the reports provide a useful view of the organization’s post-amalgamation direction: integrated systems and processes, consistent oversight across dealer categories, modernization of regulation, and continued emphasis on investor protection and market integrity.

For more information, see BLG’s Insight, What CIRO is doing: Enforcement report for 2025–2026 (July 28, 2026), and BLG’s dynamic CIRO resource, Everything you need to know about the Canadian Investment Regulatory Organization.

More room at the fundraising booth: Expanding the listed issuer financing exemption

On July 23, 2026, the Canadian Securities Administrators (CSA) published proposed amendments to National Instrument 45-106 Prospectus Exemptions relating to the Listed Issuer Financing Exemption (LIFE). The LIFE prospectus exemption is generally available to reporting issuers that have securities listed on recognized exchanges and have filed all required disclosure documents, subject to certain conditions. The proposal would make permanent the higher capital raising limits introduced by a 2025 blanket order: eligible listed issuers can raise up to $25 million (or up to $50 million for larger issuers) in a 12-month period. The CSA also proposes to revise the dilution calculation, replace the current sufficiency-of-funds condition with a short-term liquidity requirement, permit certain successor issuers to use the exemption, and streamline related conditions and disclosure.

The proposal is focused on public companies, but it also matters to registrants that participate in financings or invest in issuers using the LIFE. Registrant firms should consider reviewing their financing and due diligence procedures, selling documents and representations, and processes for confirming issuer eligibility and offering limits. For more information, see BLG’s Insight, Canadian Securities Administrators propose new amendments to the listed issuer financing exemption (LIFE).

Rebuilding the public company pavilion: Modernizing public company regulation

On July 16, 2026, the Canadian Securities Administrators (CSA) published Consultation Paper 51-406, Modernizing the Regulation of Public Companies (Paper). The Paper seeks comment on possible changes to public company regulation, including whether: (i) the distinction between venture and non-venture issuers should be redesigned; (ii) some venture issuers should be permitted to use modified financial reporting requirements; (iii) private placement hold periods for reporting issuers should be changed; (iv) material change reporting could be clarified or streamlined; and (v) U.S. reforms to periodic reporting, capital raising and disclosure should inform the Canadian approach.

Although directed principally to reporting issuers, the consultation is relevant to registrants that underwrite, advise on or invest in public company securities. For example, one consultation question asks investors which aspects of a venture issuer’s financial statements are most important to their decision-making and which are less relevant. Another asks whether the semi-annual reporting framework should be available voluntarily to all issuers. Firms should consider the potential effects on diligence standards, resale and liquidity analysis, issuer comparability, financial statement review, material change monitoring, trading restrictions, and investment mandates that distinguish between venture and non-venture issuers. The comment period closes November 13, 2026.

At the entry gate: Alberta updates KYC and trusted contact materials

On August 20, 2026, the Alberta Securities Commission (ASC) revised ASC Notice 31-701, Account Opening Assistance, and published updated sample Know-Your-Client (KYC) and Trusted Contact Person (TCP) forms.

The notice reiterates that registrants must take reasonable steps to establish a client’s identity and obtain sufficient information to satisfy KYC and suitability obligations. The sample KYC form addresses personal and financial circumstances, investment needs and objectives, investment knowledge, risk profile, and investment time horizon. It also defines concepts such as risk profile and investment objectives, and requests concentration information, including the total amount of exempt securities held as a percentage of estimated net financial assets. Notably, the form includes a page devoted to criteria for suitability notes, as well as an indicative checklist of other information that a registrant may need to obtain or provide, such as relationship disclosure information. The ASC describes the sample as a guide that firms should tailor to their needs and use in conjunction with a client discussion.

The accompanying TCP material is also a useful prompt for reviewing how firms request, document and refresh TCP information. Although the notice is directed particularly to account opening assistance for exempt market dealers in Alberta, firms elsewhere may find the forms useful as benchmarking tools.

When the outcome is the product: Prediction markets and event contracts

Event contracts do not fit neatly within existing regulatory categories, particularly when the underlying outcome involves sports or entertainment. Joint Canadian Securities Administrators (CSA) and Canadian Investment Regulatory Organization (CIRO) Staff Notice 91-307 – Guidance Related to Event Contracts: Compliance with Regulatory Requirements, published on August 27, 2026, explains the regulators’ current approach to these products, which are also described as prediction contracts or prediction market contracts. For more information, see BLG’s Insight, Prediction markets and iGaming update: Forecasting more developments ahead.

The notice focuses on event contracts based on sports or entertainment events or outcomes. CSA staff state that these products should not be regulated within securities and derivatives legislation. CIRO staff state that they do not consider it appropriate to approve applications by dealers to trade these types of contracts.

The notice does not resolve the treatment of every prediction market product. The assessment of event contracts based on other categories of events remains ongoing, and further guidance is expected.

A digital ticket to entry: Data portability and electronic KYC

On September 8, 2026, the Canadian Securities Administrators (CSA) Collaboratory published a report on its research and consultations concerning data portability, including the portability of electronic Know-Your-Client (e-KYC) data. The project explored whether investors could transfer their information between financial service providers more efficiently and securely. Participants generally supported that objective and recognized its potential to reduce duplication and improve the investor experience. They also identified possible regulatory barriers, privacy and consent concerns, and the need for standardized data.

Registrants were particularly concerned about meeting their KYC obligations when data collection is delegated through a portability service provider, and the requirement to have meaningful interactions with clients. In light of feedback received, the CSA is not proceeding at this time with the proposed live testing phase, although staff will continue to monitor developments in this area.

Securing the fairgrounds: Cybersecurity inspection results

A Canadian Securities Administrators (CSA) review of 73 registered firms found considerable variation in the maturity of cybersecurity practices. Published in July, Staff Notice 33-322, Review of Registered Firms’ Cybersecurity Practices and Additional Guidance, draws on those examinations to address how firms assign responsibility for cyber risk, translate that responsibility into policies and training, assess vulnerabilities, oversee technology vendors, and prepare to respond when an incident occurs.

Practices varied considerably. Larger organizations were more likely to have mature programs, but the central lesson applies across the market: a cybersecurity framework should be proportionate to the firm’s operations and demonstrable through records, testing and follow-up. Firms should be able to show who makes decisions, how risks and service providers are assessed, whether personnel are trained, how incidents are escalated, and how lessons from testing or actual events are incorporated into the control environment. If your firm requires assistance with reviewing policies and procedures, or designing training suggested by the guidance, please contact us.

For more information, see BLG’s Insight, Click carefully: Canadian Securities Administrators Staff Notice on cybersecurity practices (July 31, 2026).

Across the border: Foreign-listed ETFs

Foreign-listed exchange traded funds (ETFs) are available to Canadian investors, but their distribution raises distinct product review, disclosure and suitability considerations. Joint Canadian Securities Administrators (CSA) and Canadian Investment Regulatory Organization (CIRO) Staff Notice 81-339, Industry Practices Relating to Foreign-Listed Exchange-Traded Funds (Joint Notice), published on July 29, 2026, concerns the marketing and sale in Canada of ETFs listed on a foreign exchange but not on a Canadian exchange. The Joint Notice clarifies the regulatory boundaries around promotion, product due diligence and client recommendations of these products.

Registered dealers are reminded that, when advising on or recommending such products, they remain responsible for applying Know-Your-Product (KYP), Know-Your-Client (KYC) and suitability requirements, including understanding material differences between Canadian and foreign products, such as currency exposure, tax treatment, trading hours, disclosure standards, investor remedies, costs and liquidity. Order-execution-only dealers are encouraged to provide enhanced disclosure of relevant factors before a client purchases a foreign ETF.

For more information, see BLG’s Insight, The ETF next door? CIRO and CSA set expectations for foreign ETFs (August 25, 2026).

Keeping the midway running: Proposed IT system integrity rule

Earlier in October, the Canadian Securities Administrators (CSA) published proposed National Instrument 26-101 – Information Technology System Integrity. The proposal would consolidate and harmonize IT system requirements for marketplaces, recognized clearing agencies, trade repositories, information processors, and matching service utilities. Although the proposed instrument is not intended to make material changes to existing requirements, it would establish a foundation for future modernization aligned more closely with international standards. The proposal is directed to market infrastructure entities rather than registrants generally. Dealers, advisers and investment fund managers should nevertheless follow it closely – one consultation question about the second phase of the updates asks whether the obligations outlined in the National Instrument should apply to other market participants, including registrants and investment fund issuers. Comments are due January 29, 2027.

CSA’s blue-ribbon year in review

Tue, 20 Oct 2026 00:00:00 Z

On August 18, the Canadian Securities Administrators (CSA) released its 2025–2026 Year in Review, covering the first year of work under the CSA’s 2025–2028 Business Plan. The review period runs broadly from July 1, 2025, to June 30, 2026. During that period, the CSA released 54 publications spanning rule amendments, consultations, blanket orders, guidance, policy initiatives and market updates, and participated in more than 95 stakeholder engagements.

The report groups the CSA’s work under the four priorities named in its Business Plan:

Focus on the capital markets;
Focus on investors;
Focus on innovation and technology; and
Focus on systemic risk.

A significant theme is reducing unnecessary friction in Canadian capital markets while maintaining appropriate safeguards. The initiatives highlighted include a proposed harmonized prospectus exemption for self-certified investors, an optional semi-annual financial reporting regime for certain smaller venture issuers, and higher financing limits under the listed issuer financing exemption. The CSA is also seeking broader input on further modernization of the public company framework.

The enforcement statistics show the continuing prominence of fraud and crypto-related misconduct. CSA members issued 763 investor alerts, cautions and warnings, with crypto assets accounting for more than 85 per cent of them, and brought 13 crypto-related enforcement matters. Enforcement proceedings resulted in permanent market bans for 47 companies and individuals. CSA members also recorded 262 instances of formal assistance or referral involving other regulators and agencies, including 150 referrals to authorities outside Canada. Alongside enforcement, the CSA examined behavioural techniques that could help investors recognize and avoid online scams, and continued work on an independent dispute resolution framework with binding decision-making authority.

Technology work combined external engagement with improvements to the regulators’ own analytical capabilities. Through initiatives such as the CSA Collaboratory, the CSA sought feedback on how new tools are changing market practices and where regulation may need to adapt. The report also flags quantum computing as an emerging issue, presumably with possible implications for cybersecurity, market infrastructure, oversight and investor protection. For registrants, a related message is that information supplied through regulatory filings and questionnaires can be assessed across sources and over time; unexplained patterns or inconsistencies may therefore prompt regulatory follow-up.

On systemic risk, the CSA continued its annual survey work, updated derivatives trade reporting guidance, and advanced projects concerning fund liquidity and the ETF regulatory framework. These initiatives indicate that regulators remain focused on vulnerabilities that can develop across products, firms and market infrastructure, not only on isolated compliance failures.

Registrants should expect technology, emerging products, fraud prevention, operational resilience and client-focused compliance to remain important areas of regulatory attention in the year ahead.

The compliance judges’ scorecard: OSC RIE Division 2026 Annual Report

Tue, 20 Oct 2026 00:00:00 Z

Cybersecurity, artificial intelligence, fee practices and the quality of regulatory filings feature prominently in the Ontario Securities Commission’s (OSC) latest account of its registration and examination work. OSC Staff Notice 33-762, released on October 7, 2026, reports on the Registration, Inspections and Examinations Division’s (RIE) activities for the fiscal year ended March 31, 2026 (Staff Notice). For Ontario dealers, advisers and investment fund managers, the publication offers both a retrospective of the year’s examinations and a forward-looking indication of the issues most likely to attract regulatory attention. Firms registered with the Canadian Investment Regulatory Organization (CIRO) and other market participants may also find the observations in the Staff Notice useful when testing their own controls.

RIE’s recent work included focused reviews relating to the Client Focused Reforms (CFRs), digital engagement and cybersecurity, together with examinations of selected regulated entities and coordinated risk-based reviews of certain CIRO dealer firms. Rather than treating the Staff Notice as a catalogue of isolated deficiencies, firms can use it as a benchmark for assessing whether their governance, supervision and recordkeeping operate effectively in practice.

Artificial intelligence is one area to watch. Following its earlier survey, RIE began examining selected registrants’ use of AI. Early observations included firms operating without dedicated AI governance, weak controls over externally supplied AI tools, and marketing claims that were not adequately supported. RIE expects to publish further findings soon, which may inform later guidance.

The risk assessment questionnaire (RAQ) remains an important input into examination planning. A newly registered firm assessed as presenting elevated risk may be reviewed earlier after registration than a lower-risk peer. This makes consistency across the RAQ, financial information, internal reporting and the firm’s other data especially important.

RIE also revisited examinations of exempt market dealers that distributed securities of non-reporting corporate issuers under the offering memorandum exemption where required annual financial statements had not been delivered to the OSC. The work considered how dealers had applied their Know-Your-Client (KYC), Know-Your-Product (KYP) and suitability obligations to those offerings. Separate findings on this topic are expected to be released during the OSC’s 2026–2027 fiscal year.

Two recurring control issues have immediate practical implications:

First, related to employment agreements, such agreements (or severance and related agreements) should not discourage employees from communicating possible misconduct to the OSC or another regulatory authority; provisions that impede whistleblowing may lead to enforcement action.
Second, related to the insurance requirements for registrants, insurance limits must be reassessed as the business changes. Firms whose assets under management have grown should confirm that coverage has kept pace with the applicable requirements.

Other findings included incomplete KYC information relating to leverage used for managed account clients; insufficient product analysis for alternative investments in managed accounts; excessive exposure to a single issuer or sector; management fees that were charged but did not match the client agreement or disclosed schedule; and disclosure that did not clearly explain how and when fees were charged. Discretionary managers should also have controls for identifying and resolving departures from investment policy statements. Firms should separately consider whether operational changes (such as introducing a fully paid securities lending program) require an update on Form 33-109F5 to firm information previously provided on Form 33-109F6.

What is on display for fund managers: OSC Investment Management Division Annual Summary Report

Tue, 20 Oct 2026 00:00:00 Z

The Ontario Securities Commission’s (OSC) Investment Management Division released OSC Staff Notice 81-741 on September 15, 2026 (IM Staff Notice), summarizing its fiscal 2025–2026 work. The publication draws together trends from prospectus and exemptive relief files, continuous disclosure reviews, ownership change notices under sections 11.9 and 11.10 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103), and the Division’s current policy agenda.

Product development remains brisk. The IM Staff Notice describes continued ETF expansion and newer strategies involving collateralized loan obligations, crypto assets, three times daily leverage and exposure to a single issuer. These products raise familiar disclosure, risk rating and suitability questions in less familiar forms.

In its continuous disclosure work, staff used investment fund survey data to identify funds warranting closer review. Areas of interest included leverage and changes in liquidity from one year to the next. Staff also examined cases where a third-party measure (such as standard deviation or a risk assessment) did not align with the risk rating shown in the Fund Facts. Managers should be prepared to explain both the methodology selected and any apparent inconsistency among the data, the rating and the disclosure delivered to investors.

The Division is also reconsidering how it handles notices of proposed acquisitions and ownership changes under sections 11.9 and 11.10 of NI 31-103. The IM Staff Notice indicates that technology may support a more differentiated, risk-based review process. Further information on any change of process for these reviews will be provided in advance. In furtherance of this objective, we note as well that in OSC Staff Notice 33-762, the Registration, Inspections and Examinations Division stated that in connection with certain acquisitions of firms, such as where new owners have a new business plan, staff will request a Form 33-109F6 reflecting the firm post-acquisition, together with completed Forms 33-109F4 for each proposed registered and permitted individual, and ask new key personnel to attend an in-person meeting to discuss proposed activities of the firm post-acquisition.

Other current projects for the Investment Management Division include continued work on replacing the annual and interim Management Reports of Fund Performance with a Fund Report; developing an access-based continuous disclosure model for investment fund issuers; revisiting the ETF framework; addressing crypto-asset funds; reviewing liquidity risk; and considering pathways for retail exposure to longer-term assets. With respect to the latter, Staff has signalled its current priority is to work with funds actively seeking exemptive relief for long-term asset strategies. Finally, managers of collective investment vehicles that fall outside the statutory definition of an investment fund should note that a future investment fund survey may include in scope certain “fund-like” entities to improve regulatory visibility into private credit.

For more detail on these initiatives, see BLG’s Insight, Ontario Securities Commission (OSC) Investment Management Division Annual Summary Report: Insights from Staff Notice 81-741.

Measurements matter: City avoids liability for sidewalk fall

Mon, 19 Oct 2026 00:00:00 Z

The Ontario Superior Court of Justice recently dismissed a plaintiff’s trip-and-fall lawsuit against the City of London in Weiler v. City of London, 2026 ONSC 2011. The court found that the plaintiff failed to prove the sidewalk discontinuity exceeded the two-centimetre threshold under the Minimum Maintenance Standards (MMS). The court also ruled that the city's pandemic-related decision to pause annual inspections was protected by core policy immunity.

Background

On March 11, 2021, the plaintiff tripped and fell on a city-owned residential sidewalk near her home in London, Ontario. At trial, the key issue was the size of the sidewalk discontinuity. Under section 16.1(3) of the MMS, a sidewalk surface discontinuity of two centimetres or less is in a state of repair.

Evidence at trial

The parties each relied on their own photographs and expert evidence concerning the height of the sidewalk discontinuity. The plaintiff’s expert opined that the discontinuity was “approximately” two centimetres and might have been higher. The plaintiffs also argued that the City’s subsequent marking and repair of the sidewalk supported the conclusion that the discontinuity exceeded the repair threshold.

Conversely, the City measured the discontinuity at several points, which ranged from 1.3 to 1.8 centimetres. Although the city marked the discontinuity with orange paint and requested a repair, the city testified that it did so out of prudence because of the reported fall, not because the MMS required repair.

The City’s engineering expert reviewed the photographs and CCTV video evidence from a neighbouring home and concluded that the discontinuity in the area where the plaintiff fell was approximately 1.6 centimetres.

The Court accepted the City’s evidence, finding that the discontinuity ranged between 1.2 and 1.7 centimetres and in the area where the plaintiff’s foot struck the sidewalk, the discontinuity measured approximately 1.6 centimetres. The sidewalk was therefore deemed to be in a state of repair under the MMS, and the action was dismissed on that basis.

Core policy immunity

Although it was unnecessary to the final result, the court also reviewed the city’s alternative defences.

The City admitted it did not complete its annual sidewalk inspection in 2020, as required under section 16.1(1) of the MMS. At trial, the City led evidence that, following the declaration of states of emergency by the Province of Ontario and the City of London due to COVID-19, it transitioned to minimal operations focused on essential services. Specifically, sidewalk maintenance was shifted to a minimal or emergency-only basis, and no annual inspections occurred in 2020.

The Court applied the Supreme Court of Canada’s core policy immunity framework from Nelson (City) v. Marchi. It found that the City’s decision not to complete the sidewalk inspection was not merely operational. Rather, it formed part of a broader emergency decision-making process involving public-health concerns, staffing restrictions, financial pressures, service reductions and budgetary mitigation measures approved by senior City officials and City Council. The City’s decision-making bore the hallmarks of core policy, and there was no evidence that the decision was irrational or made in bad faith.

Accordingly, if the sidewalk had been in a state of non-repair, the Court would have found the City immune from liability for its failure to inspect. Further, given the City’s failure to inspect the sidewalk, the Court held the City did not know, and could not reasonably have been expected to know, about the state of repair of the sidewalk, giving rise to a statutory defence under s. 44(3)(a) of the Municipal Act.

Key takeaways

Measurements must be exact: This decision is helpful for municipalities defending against trip-and-fall claims near the two-centimetre threshold. Evidence that a discontinuity is "approximately" two centimetres is insufficient; plaintiffs must prove it exceeds the limit.
Immunity has its limits: The core policy immunity analysis here is important but narrow. The court specifically grounded its conclusion in the exceptional circumstances of the COVID-19 emergency. Municipalities should not interpret this ruling as broad permission to skip routine inspection obligations under normal conditions.

How BLG can help

Managing municipal liability claims requires a clear understanding of the Minimum Maintenance Standards and statutory defences. BLG’s municipal law and litigation teams regularly defend local governments against trip-and-fall lawsuits and other complex tort claims. We can help your municipality assess risk, build strong litigation strategies and apply protections like core policy immunity effectively.

If you have questions about how this decision might impact your risk management practices, please reach out to our team or the author of this article to discuss your specific needs.