May 19, 2010
Canadian securities regulators are eyeing updates to their rules governing issuer communications with beneficial owners who hold securities through intermediaries, including their own version of e-proxy.
Canadian Securities Administrators is seeking comment on proposed rule changes that, among other things, would allow a new "notice-and-access" model similar to the e-proxy rules in place in the United States. However, unlike the U.S. model, the proposed Canadian version of e-proxy would be voluntary. Canadian reporting issuers would be allowed (but not required) to send investors a notice informing them that their annual proxy-related materials are available online instead of sending them by mail. Web posting of proxy-related materials would only be required only if the issuer chooses to use notice-and-access, and the voting instruction form would be required to be sent with the initial notice.
"This is significant, as it is the first major proposal to allow [Canadian] companies to provide required documents over the Internet," says Leslie McCallum. "It’s really opening the door to moving from hard copies to electronic copies."
Since Canadian companies currently are required each year to mail a hard copy of their annual financial statements and management's discussion and analysis, either to all security holders or to those who request them, Leslie notes, "for some companies, it might be more efficient to continue their current practice of mailing their proxy materials along with their financial statements and MD&A in a single delivery to all security holders."
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