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SECURITIES AMENDMENT ACT, 2014

SECURITIES AMENDMENT ACT, 2014

Chapter 17

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Alberta, enacts as follows:


Amends RSA 2000 cS‑4

1   The Securities Act is amended by this Act.

 

2   Section 1 is amended

                            (c)    by adding the following after clause (oo):

                           (oo.1)    “professional corporation” means a corporation that acts as a dealer or adviser on behalf of another dealer or adviser through one or more RPC representatives;

                            (e)    by adding the following after clause (zz): 

                            (zz.1)    “registered professional corporation” means a corporation that is registered as a professional corporation pursuant to section 75;

                            (zz.2)    “RPC representative” means a representative of a registered dealer or advisor acting as a dealer or adviser within a professional corporation;

 

22   Section 75 is amended by adding the following after subsection (2):

(2.1)  Notwithstanding subsection (2), a professional corporation that is registered in accordance with Alberta securities laws may act as a dealer or adviser through an RPC representative on behalf of a person or company required to be registered under subsection (1).

 

23   Section 76(1) is amended by striking out “Unless” and substituting “Subject to section 76.01, unless”.

 

24   The following is added after section 76:

Registration of professional corporation

76.01   The Executive Director shall not register a professional corporation unless

                                 (a)    the name of the professional corporation

                                        (i)    includes the words “Professional Corporation” or the abbreviation “Prof. Corp.”, and

                                      (ii)    indicates that the professional corporation acts as a dealer or adviser,

                                    and

                                 (b)    the articles of incorporation of the professional corporation

                                        (i)    restrict its business to acting as a dealer or adviser,

                                      (ii)    include a restriction that the voting shares of the professional corporation can be owned only by one or more RPC representatives,

                                     (iii)    subject to subclause (ii), include a restriction that the non‑voting shares of the professional corporation can be owned only by

                                            (A)    an RPC representative,

                                            (B)    a spouse, adult interdependent partner, child or parent of an RPC representative,

                                            (C)    a corporation, all of the shares of which are owned by individuals mentioned in paragraphs (A) or (B), or

                                            (D)    a trust all of the beneficiaries of which are individuals mentioned in paragraphs (A) or (B),

                                     (iv)    include a restriction that each director of the professional corporation must be an RPC representative, and

                                       (v)    include a restriction that no owner of voting shares of a professional corporation shall pledge or enter into a voting trust agreement or proxy or any other type of agreement that vests in a person who is not an individual registrant the authority to exercise the voting rights attached to any or all of the owner’s shares.

Vesting of shares

76.02   The voting and non‑voting shares of a professional corporation may be vested in

                                 (a)    an executor or administrator of the estate of a shareholder for the limited purpose of permitting the executor or administrator to discharge his or her duties in relation to the administration of the estate, or

                                 (b)    a trustee in bankruptcy for the limited purpose of permitting the trustee in bankruptcy to discharge his or her duties as trustee in bankruptcy of the estate of a shareholder or the professional corporation.

Legal relationships, legal authority and liability

76.03(1)  Alberta securities laws apply to an RPC representative notwithstanding that the RPC representative acts as a dealer or adviser through a professional corporation.

(2)  The legal relationship between an RPC representative and the dealer or adviser on whose behalf the RPC representative acts is not affected by the fact that the RPC representative acts as a dealer or adviser through a professional corporation.

(3)  A dealer or adviser has the same legal authority over a professional corporation as the dealer or adviser has over the RPC representative who acts as a dealer or adviser through the professional corporation.

(4)  The legal relationship between an RPC representative and a self‑regulatory organization that regulates the RPC representative is not affected by the fact that the RPC representative acts as a dealer or adviser.

(5)  A self‑regulatory organization has the same legal authority over a professional corporation as it does over the RPC representative who acts as a dealer or adviser through the professional corporation.

(6)  The liability of an RPC representative to a client is not affected by the fact the RPC representative acts as a dealer or adviser through a professional corporation.

(7)  The liability of a registered dealer or registered adviser to a client of an RPC representative is not affected by the fact that the RPC representative acts as a dealer or adviser through a professional corporation.

(8)  The law applicable to the confidential, ethical or fiduciary relationships between an RPC representative and a client is not affected by the fact that the RPC representative acts as a dealer or adviser through a professional corporation.

(9)  All rights and obligations with respect to communications made to or information received by an RPC representative apply to the shareholders, directors, officers and employees of the professional corporation through which the RPC representative acts as a dealer or adviser.

 

55   Section 223 is amended

                           (b)    by repealing clause (j)(vi) and (vii) and substituting the following:

                               (vi)    prescribe conditions of registration, including standards of practice and business conduct of registrants when dealing with customers, clients and other registrants;

                              (vii)    prescribe the disclosure or furnishing of information by registrants to customers, clients, the public, other registrants and the Commission;

 

59   Sections 2(c) and (e), 13, 17, 22, 23, 24, 30, 33(c) and (d), 34 and 55(b) come into force on Proclamation.