Information Technology Activities (Cooperative Credit Associations) Regulations

Information Technology Activities (Cooperative Credit Associations) Regulations Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to sections 396a and 463b of the Cooperative Credit Associations Actc, hereby makes the annexed Information Technology Activities (Cooperative Credit Associations) Regulations. S.C. 2001, c. 9, s. 314 S.C. 2001, c. 9, s. 339 S.C. 1991, c. 48 Definitions The following definitions apply in these Regulations. Act means the Cooperative Credit Associations Act. (Loi) balance sheet value, in respect of the shares and ownership interests held by an entity, means the value reported on its balance sheet on an unconsolidated basis. (valeur au bilan) book value[Repealed, SOR/2008-168, s. 13] member of an association’s group has the same meaning as in subsection 386(2) of the Act. (membre du groupe d’une association) Prescribed purpose or circumstance For the purposes of subparagraph 376(1)(h)(iii) of the Act and subject to the approval required under paragraph 376(1)(h) of the Act, an association may develop, design, hold, manage, manufacture, sell or otherwise deal with data transmission systems, information sites, communication devices or information platforms or portals that are used for a purpose or in a circumstance that is materially related to the provision of financial products or services by the association or a member of the association’s group. Prescribed activity For the purposes of paragraph 390(2)(f) of the Act and subject to subsections (2) and (3), a prescribed activity in relation to an entity is developing, designing, holding, managing, manufacturing, selling or otherwise dealing with any data transmission system, information site, communication device or information platform or portal that is used to provide information services. Limit on size of investment An association may not acquire control of, or hold, acquire or increase a substantial investment in, an entity engaging in an activity described in subsection (1) if the sum of the following exceeds 5% of the association’s regulatory capital: the aggregate balance sheet value of the shares and ownership interests that the association and its subsidiaries, whether individually or jointly, would acquire in the entity under paragraph 390(2)(f) of the Act, the aggregate balance sheet value of the shares and ownership interests held by the association and its subsidiaries, whether individually or jointly, in entities engaging in an activity described in subsection (1) that the association holds control of, or a substantial investment in, under paragraph 390(2)(f) of the Act, and the aggregate value of outstanding loans made by the association and its subsidiaries, whether individually or jointly, to entities engaging in an activity described in subsection (1) that the association holds control of, or a substantial investment in, under paragraph 390(2)(f) of the Act. Restricted activities An association may not acquire control of, or hold, acquire or increase a substantial investment in, an entity engaging in an activity described in subsection (1) if the entity engages in the business of accepting deposit liabilities or if the activities of the entity include activities that an association is not permitted to engage in under any of sections 378, 382 and 382.1 of the Act; dealing in securities, except as may be permitted under paragraph 390(2)(e) of the Act or as may be permitted either to an association under paragraph 376(1)(f) of the Act or to a retail association under subparagraph 376(1)(i)(ii) of the Act; dealing in goods, wares or merchandise that an association is not permitted to deal in under subsection 376(3) of the Act, other than as permitted under subsection (1); activities that an association is not permitted to engage in under section 381 of the Act if the entity engages in the activities of a finance entity or of any other entity prescribed under paragraph 390(3)(c) of the Act; acquiring control of or acquiring or holding a substantial investment in another entity unless in the case of an entity that is controlled by the association, the association itself would be permitted under Part X of the Act to acquire a substantial investment in the other entity, or in the case of an entity that is not controlled by the association, the association itself would be permitted to acquire a substantial investment in the other entity under subsection 388(2), paragraph 388(3)(b) or (c) or subsection 388(4) or 390(1) or (2) of the Act; or any activity prescribed under paragraph 390(3)(e) of the Act. Exemption from restrictions For the purposes of subparagraph 3(3)(e)(ii), subsections 390(4) to (6) of the Act do not apply in determining whether an association would be permitted to acquire a substantial investment in an entity under subsection 388(2), paragraph 388(3)(b) or (c) or subsection 388(4) or 390(1) or (2) of the Act. Non-application Subsection 390(5) of the Act does not apply where, under paragraph 390(2)(f) of the Act, an association acquires control of, or acquires or increases of a substantial investment in, an entity whose business is limited to activities described in subsection 3(1). Nothing in this section limits the operation of subsections 3(2) and (3). Coming into force These Regulations come into force on the day on which they are registered.