The British Columbia Securities Commission (BCSC) will soon require additional disclosure from companies that raise money in B.C. stock markets under prospectus exemptions.
“Typically, if someone is buying shares in a private company in the exempt market, there is very little information available to them,” BCSC chairwoman Brenda Leong said in a press release.
“The new disclosure requirements are another step in our integrated strategy to protect investors from the risks associated with investing in the exempt market, and to support the integrity of legitimate venture companies raising capital in this market.”
The announcement of the new disclosure requirements follows a BSCS review and consultation with investors and industry participants.
The BSCS plans to replace the disclosure form used by other Canadian jurisdictions.
The new form will require private companies to disclose information about their insiders and promoters. It will also require public and private companies to disclose if anyone buysing their securities – or finding investors for them – is an insider or registered under the Securities Act.
“The additional disclosure will help current and prospective investors make more informed investment decisions when considering exempt market securities, and support our increased regulatory scrutiny of this higher-risk market,” Leong said.
The new requirements come into effect October 3, 2011.
Jenny Wagler
Twitter: JennyWagler_BIV