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Publication
Merger law reform in Australia: What next after the Exposure Draft?
As expected, the Australian Commonwealth Treasury released an exposure draft for the proposed new Australian merger regime on 24 July 2024.
Canada | Publication | March 24, 2023
On February 22, the Canadian Securities Administrators (CSA) published Staff Notice 21-332 – Crypto Asset Trading Platforms: Pre-Registration Undertakings — Changes to Enhance Canadian Investor Protection (SN 21-332). SN 21-332 supplements the CSA’s August 2022 update (the August update), which required unregistered crypto asset trading platforms (CTPs) to provide “pre-registration undertakings” (PRUs), pending review of their applications to become registered dealers. The August update effectively modified the registration framework previously set out in Staff Notice 21-329 – Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements (SN 21-329).
CTPs should note that SN 21-332 introduced additional commitments to those the CSA announced in the August update that must be included by CTPs in their PRUs. Accordingly, CTPs that have filed PRUs following the August update are expected to file revised PRUs incorporating the supplemental commitments required by the August update (an enhanced PRU) within 30 days of the publication of SN 21-332.
The CSA has become increasingly concerned with the risks involved in trading in crypto assets due to their highly volatile value and liquidity – particularly in light of recent insolvencies within the industry.
The August update was intended to mitigate a gap in compliance obligations that had been recognized, following the publication of SN 21-329, between CTPs operating in Canada who had completed the registration process, and those seeking to undertake the process. CTPs who had applied to become registered dealers were required to provide PRUs (an initial PRU) to their principal regulators to continue operations while their applications were reviewed.
This announcement was part of a larger effort by the CSA and the Investment Industry Regulatory Organization of Canada to develop a regulatory framework for trading in crypto assets that balances flexibility, innovation, and investor protection. For additional details on these initial steps and the commitments expected under the initial PRUs, refer to our previous update here.
The following list summarizes the additional requirements the CSA expects unregistered CTPs to include in their enhanced PRUs:
CTPs operating in Canada that fail to file an enhanced PRU, or do not abide by the provisions of the enhanced PRU once filed, may be subject to compliance and enforcement action. This may include:
SN 21-332 reflects that implementing regulatory mechanisms to mitigate the risks associated with trading crypto assets remains a CSA priority. CTPs that previously filed an initial PRU should be aware of the additional commitments required by SN 21-332, and should prioritize filing an enhanced PRU within 30 days of February 22, 2023.
Although beyond the scope of this update, for readers interested in the topic, we note the CSA also included some discussion about “stablecoins” beginning on p. 9 of SN 21-332.
The full text of the CSA news update is available here.
The authors wish to thank Johanna Vanneste, articling student, for her help in preparing this legal update.
Publication
As expected, the Australian Commonwealth Treasury released an exposure draft for the proposed new Australian merger regime on 24 July 2024.
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