CSA Notice and Request for Comment - Proposed Amendments to National Instrument 45-106 Prospectus Exemptions relating to the Listed Issuer Financing Exemption

The CSA is seeking to codify increases to the amount of funds that qualified listed issuers can raise without a prospectus, as the initiative continues to demonstrate strong uptake and effectiveness in supporting capital-raising in Canada while maintaining investor protection.

The CSA introduced the listed issuer financing exemption (LIFE) in November 2022 to offer a more efficient capital-raising option for eligible Canadian exchange-listed issuers that have filed all timely and periodic disclosure documents required under securities legislation.

The proposed amendments would primarily codify a 2025 blanket order that increased the amount that can be raised under LIFE, from a maximum of $10 million to $25 million – or up to $50 million for larger companies – in a 12-month period, subject to conditions. The proposed amendments also respond to feedback received from certain market participants by streamlining other conditions of the exemption.

Closing Consultation Date: October 21, 2026

Submit your feedback

A copy of the Consultation Paper can be found on the website of the following jurisdictions:

Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia, Ontario, Québec, Saskatchewan

Questions about this proposal? Please refer to any of the following:

British Columbia Securities Commission
Larissa Streu
Manager, Corporate Disclosure
lstreu@bcsc.bc.ca

Nahal Iranpour
Legal Counsel, Corporate Finance
niranpour@bcsc.bc.ca

Grace Zheng
Senior Securities Analyst, Corporate Disclosure
gzheng@bcsc.bc.ca

Alberta Securities Commission
Tracy Clark
Senior Legal Counsel, Corporate Finance
Tracy.Clark@asc.ca

Gillian Findlay
Senior Legal Counsel, Corporate Finance
Gillian.Findlay@asc.ca

Financial and Consumer Affairs Authority of Saskatchewan
Heather Kuchuran
Director, Corporate Finance
heather.kuchuran@gov.sk.ca

Manitoba Securities Commission
Patrick Weeks
Deputy Director, Corporate Finance
patrick.weeks@gov.mb.ca

Ontario Securities Commission
David Surat
Associate Vice-President, Corporate Finance Division
dsurat@osc.ca

Darren Sutherland
Senior Accountant, Corporate Finance Division
dsutherland@osc.ca

Clara Ryu
Senior Legal Counsel (Acting), Corporate Finance Division
cryu@osc.ca

Sam MacDougall
Legal Counsel, Corporate Finance Division
smacdougall@osc.ca

Autorité des marchés financiers
Laurence Ménard
Senior Coordinator, Mergers and Acquisitions
laurence.menard@lautorite.qc.ca

Najla Sebaai
Senior Policy Advisor, Corporate Finance Policy
najla.sebaai@lautorite.qc.ca

Geneviève Laporte
Senior Coordinator, Corporate Finance Oversight
genevieve.laporte@lautorite.qc.ca

Nova Scotia Securities Commission
Peter Lamey
Legal Analyst, Corporate Finance
peter.lamey@novascotia.ca

Abel Lazarus
Director, Corporate Finance
abel.lazarus@novascotia.ca

Financial and Consumer Services Commission of New Brunswick
Moira Goodfellow
Senior Legal Counsel, Securities
moira.goodfellow@fcnb.ca

Technical questions about submitting your comments? Click here to contact the CSA Secretariat. Or alternatively please reach out to info@acvm-csa.ca.

Proposed Amendments to National Instrument 45-106 Prospectus Exemptions relating to the Listed Issuer Financing Exemption

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General Comments

1. Currently, the sufficiency of funds condition requires that an issuer reasonably expect to have available funds to meet its business objectives and liquidity requirements for a period of 12 months following the distribution. We have heard that many smaller issuers cannot use the exemption as they are unable to raise sufficient funds to meet this condition.

1a. Do you think the proposal to modify the sufficiency of funds condition, combined with enhanced disclosure in the offering document, addresses the concerns raised?

1b. Is there additional disclosure regarding an issuer’s financial condition that should be required under the exemption?

1c. Do you think a better alternative would be to shorten the current condition to a period of less than 12 months. Would a 6-month period be more appropriate?

1d. Since retail investors are able to purchase the same securities offered under the exemption on an exchange without the additional disclosure provided under the exemption, should we consider removing the sufficiency of funds condition altogether, or does the fact that retail investors may be solicited under the exemption justify retaining this condition?

2. Currently, the securities eligible to be distributed under the exemption are limited to a listed equity security or a unit consisting of a listed equity security and a warrant convertible into a listed equity security. We had intended that the exemption be limited to listed securities that investors are familiar with, have an established trading history and are commonly understood, while also reflecting the common types of securities used by smaller issuers. We had previously received feedback that the complexity of convertible debt instruments, together with the more comprehensive risk disclosure required, may be inappropriate for the intended simplicity of the offering document. However, we have also received feedback from some dealers that permitting convertible debentures under the exemption may assist reporting issuers in raising capital and may appeal to certain investors.

2a. Should we expand the exemption to permit the distribution of convertible debentures that are convertible into listed equity securities?

2b. Are retail investors sufficiently familiar with convertible debentures or are they too complicated to be considered under the exemption?

2c1. If we were to expand the exemption to allow for convertible debentures, should we impose additional conditions such as those required by the exchanges including those related to the issuance price, the interest rate, and the terms of conversion of the convertible debentures? If so, what conditions would be appropriate?

2c2. If we were to expand the exemption to allow for convertible debentures, should securities issuable on conversion of convertible debentures be excluded from the 50% dilution calculation if the debentures are not convertible within 60 days after the closing?

3. Under the exemption, issuers are subject to an overall dilution limit for all offerings using the exemption in a 12-month period of 50% of an issuer’s outstanding securities as of the date that is 12 months before the offering. Under the Blanket Order and the Proposed Amendments, issuers are subject to an overall dilution limit of 50% that is calculated as of the date of the news release announcing the offering if the issuer has not closed a prior offering under the exemption in the previous 12 months, or the date of the news release announcing the first offering under the exemption in the previous 12 months. Issuers may exclude securities issuable on exercise of warrants from the calculation if they are not convertible for a period of 60 days after closing. Issuers that have reached the dilution limit under the exemption in a 12-month period may continue to distribute securities under other prospectus exemptions or a prospectus. However, we have received mixed feedback from market participants about the current 50% dilution limit. Some market participants think it imposes too significant a limit on the amount that can be raised by smaller issuers while others raise concerns about the potential dilutive impact if we were to increase the 50% limit.

3a. Is the dilution limit in the Proposed Amendments appropriate?

3b. If not, what other dilution limits should we consider and why?

We propose to allow the omission of the offering price in the offering document if certain conditions are met. These conditions would include that the news release announcing the offering must include the expected range of the offering price and that the issuer must file an amendment to the offering document by the 2nd business day after the date the offering price is determined.

4. Should issuers be required to include the expected range of the offering price in the news release announcing the offering?

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Proposed Amendments to National Instrument 45-106 Prospectus Exemptions relating to the Listed Issuer Financing Exemption

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