CALGARY – September 13, 2018 – The Alberta Securities Commission (ASC) today published for comment Proposed Blanket Order 45-520 Facilitating Access to Capital for Community Economic Development Corporations. This Blanket Order would offer a new, limited exemption to the financial statement requirements of the offering memorandum prospectus exemption (OM Exemption) for community economic development corporations (CEDCs).
The CEDC program is a product of the recently adopted Investing in a Diversified Alberta Economy Act, which provides a tax credit to investors in businesses that have social impact or provide economic development within their local community.
If adopted, the Blanket Order would allow a CEDC issuer using the OM Exemption to prepare its financial statements in accordance with generally accepted accounting principles for private enterprises, instead of for publicly accountable enterprises, and to have those financial statements reviewed by a public accountant instead of audited.
Issuers relying on this financial statement relief would be subject to the following investor protection conditions:
- Each investor must complete an enhanced risk warning.
- The total amount raised is limited to $5,000,000.
- The amount contributed per investor is also limited. For example, unless individuals meet specified income or asset tests, the maximum they could invest in CEDCs would be $5,000.
“We believe the Proposed Blanket Order will help support economic development in Alberta by helping entrepreneurs and small business owners raise the capital they need, while at the same time balancing that with the need for investor protection,” said Stan Magidson, Chair and Chief Executive Officer of the ASC.
A copy of the Proposed ASC Blanket Order 45-520 Facilitating Access to Capital for Community Economic Development Corporations can be found on the ASC website at albertasecurities.com. Comments should be submitted in writing by October 15, 2018.
The ASC is the regulatory agency responsible for administering the province's securities laws. It is entrusted with fostering a fair and efficient capital market in Alberta and with protecting investors. As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.
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