Bill 14, More Tax Cuts for Jobs, Growth and Prosperity Act, 1999

Versions

Bill 14

Bill 141999

An Act to implement the 1999 Budget and to make other amendments to various Acts in order to foster an environment for jobs, growth and prosperity in Ontario

contents

Part I

Ambulance Act

Partie I

Loi sur les ambulances

Part II

Assessment Act

Partie II

Loi sur l'valuation foncire

Part III

Capital Investment Plan Act, 1993

Partie III

Loi de 1993 sur le plan d'investissement

Part IV

Commodity Futures Act

Partie IV

Loi sur les contrats terme sur marchandises

Part V

Community Small Business Investment Funds Act

Partie V

Loi sur les fonds communautaires d'investissement dans les petites entreprises

Part VI

Corporations Tax Act

Partie VI

Loi sur l'imposition des corporations

Part VII

Education Act

Partie VII

Loi sur l'ducation

Part VIII

Electricity Act, 1998

Partie VIII

Loi de 1998 sur l'lectricit

Part IX

Employer Health Tax Act

Partie IX

Loi sur l'impt-sant des employeurs

Part X

Fair Municipal Finance Act, 1997 (No. 2)

Partie X

Loi de 1997 sur le financement quitable des municipalits (n^o 2)

Part XI

Financial Administration Act

Partie XI

Loi sur l'administration financire

Part XII

Income Tax Act

Partie XII

Loi de l'impt sur le revenu

Part XIII

Land Transfer Tax Act

Partie XIII

Loi sur les droits de cession immobilire

Part XIV

Local Roads Boards Act

Partie XIV

Loi sur les rgies des routes locales

Part XV

Ministry of Government Services Act

Partie XV

Loi sur le ministre des Services gouvernementaux

Part XVI

Municipal Act

Partie XVI

Loi sur les municipalits

Part XVII

Northern Services Boards Act

Partie XVII

Loi sur les rgies des services publics du Nord

Part XVIII

Ontario Guaranteed Annual Income Act

Partie XVIII

Loi sur le revenu annuel garanti en Ontario

Part XIX

Provincial Land Tax Act

Partie XIX

Loi sur l'impt foncier provincial

Part XX

Retail Sales Tax Act and complementary amendments

Partie XX

Loi sur la taxe de vente au dtail et modifications complmentaires

Part XXI

Securities Act

Partie XXI

Loi sur les valeurs mobilires

Part XXII

Toronto Stock Exchange Act and complementary amendments

Partie XXII

Loi sur la Bourse de Toronto et modifications complmentaires

Part XXIII

Commencement and Short Title

Partie XXIII

Entre en vigueur et titre abrg

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

Part I

Ambulance Act

1.The definition of ``upper-tier municipality" in subsection 1 (1) of the Ambulance Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 2, is amended by inserting ``the County of Brant" after ``the City of Toronto".

2.Section 5 of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by adding the following definition:

``transition period" means the one-year period that begins on January 1, 2000 and ends on December 31, 2000. (``priode de transition")

3.(1)Clause 6 (1) (a) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by adding at the end ``subject to any grant made to the municipality under subsection 4 (3)".

(2)Clause 6 (1) (b) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by striking out ``on and after January 1, 2000" at the beginning and substituting ``on and after January 1, 2001".

(3)Subsection 6 (6) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by striking out ``Until January 1, 2000," at the beginning and substituting ``Until January 1, 2001".

(4)If on the day this subsection comes into force, subsection 5 (1) of Schedule J to the Red Tape Reduction Act, 1999, being Bill 11 of the 1st Session of the 37th Legislature, is not in force, subsection 6 (7) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by striking out ``Despite clause (1) (b) and subsection (6), and subject to section 6.3, at any time during the protection period" at the beginning and substituting ``Despite clause (1) (b) and subsection (6) and subject to section 6.3, at any time during the protection and transition periods".

(5)On the later of the day this subsection comes into force and the day subsection 5 (1) of Schedule J to the Red Tape Reduction Act, 1999, being Bill 11 of the 1st Session of the 37th Legislature, comes into force, subsection 6 (7) of the Act, as re-enacted by section 5 of Schedule J to the Red Tape Reduction Act, 1999, is amended by striking out ``Despite clause (1) (b) and subsection (6) and subject to section 6.3, at any time during the protection period" at the beginning and substituting ``Despite clause (1) (b) and subsection (6) and subject to section 6.3, at any time during the protection and transition periods".

(6)Subsection 6 (8) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by striking out the portion before clause (a) and substituting the following:

Discharge of responsibilities

(8)In discharging its responsibility under clause (1) (b), subsection (7) or subsection 6.4 (5) or (8.4), an upper-tier municipality shall,

. . . . .

(7)Subsection 6 (9) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is repealed and the following substituted:

Same, selection of operators

(9)The selection of a person who will provide land ambulance services in an upper-tier municipality shall,

(a)during the protection and transition periods, be made in accordance with sections 6.4 and 6.5; and

(b)after the transition period, be made in accordance with section 6.1.

4.Subsection 6.1 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by striking out ``After the protection period" at the beginning and substituting ``After the transition period".

5.Subsections 6.3 (4), (5) and (6) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, are repealed.

6.Subsections 6.4 (5), (6), (7) and (8) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, are repealed and the following substituted:

Responsibility for provision of services

(5)Despite clause 6 (1) (b) and subsection 6 (6), an upper-tier municipality that makes a selection under subsection (1) shall, on and after January 1, 2000, be responsible for ensuring the proper provision of land ambulance services in the entire municipality in accordance with the needs of the persons in the municipality and shall discharge that responsibility in accordance with subsection 6 (8).

Same, partial selection

(6)Subsection (5) applies even though the upper-tier municipality selects one or more persons to provide land ambulance services in only part of the municipality.

Failure to select under subs. (1)

(7)If an upper-tier municipality fails to select a person to provide land ambulance services in all or part of the municipality on or before September 30, 1999,

(a)any operator who, on and before September 30, 1999, was providing land ambulance services in a part of the municipality for which no person has been selected to provide land ambulance services may continue to provide those services for a one-year period beginning on January 1, 2000, subject to a new operator being selected under clause (b) before the end of that period; and

(b)the municipality may, on or after the day section 6 of the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 comes into force but before September 3, 2000, select a person to provide land ambulance services in the municipality instead of the operator referred to in clause (a), subject to subsection (8.2).

Continued provision of services

(8)Subsection 6.3 (2) applies with necessary modification to an operator who continues to provide land ambulance services during the one-year period referred to in clause (7) (a).

Same

(8.1)Despite subsection (8), if an upper-tier municipality assumes responsibility for ensuring the proper provision of land ambulance services during the one-year period referred to in clause (7) (a), the terms and conditions under which the existing operator shall continue to provide those services shall be determined by agreement with the upper-tier municipality.

Notice of selection

(8.2)A selection under clause (7) (b) is not effective unless the upper-tier municipality gives the existing operator and the Director at least 120 days written notice that a new operator has been or will be selected and that the existing operator must, 120 days from receipt of the notice or at such later time as may be specified in the notice, cease providing land ambulance services in the municipality.

Method of selection

(8.3)An upper-tier municipality shall select a person under clause (7) (b) pursuant to a request for proposals issued by the municipality. However, the municipality may choose to provide the land ambulance services itself instead of conducting the request for proposals.

Responsibility for provision of services

(8.4)In the case of an upper-tier municipality that made no selection under subsection (1), that has not become responsible for ensuring the proper provision of land ambulance services in the municipality under subsection 6 (7) and that makes a selection under clause (7) (b), the municipality shall, despite clause 6 (1) (b) and subsection 6 (6), be responsible for ensuring the proper provision of land ambulance services in the entire municipality in accordance with the needs of the persons in the municipality on and after the earlier of,

(a)January 1, 2001; or

(b)the day the new operator begins providing land ambulance services in the municipality.

Same

(8.5)An upper-tier municipality that becomes responsible for ensuring the proper provision of land ambulance services under subsection (8.4) shall discharge that responsibility in accordance with subsection 6 (8).

Same, partial selection

(8.6)Subsection (8.5) applies even though the upper-tier municipality selects a new operator to provide land ambulance services in only part of the municipality.

Failure to select under cl. (7) (b)

(8.7)If an operator who was providing land ambulance services in an upper-tier municipality on and before September 30, 1999 is still providing services in the municipality on December 31, 2000 and has not received a notice referred to in subsection (8.2), the operator may continue to provide land ambulance services in the municipality on and after January 1, 2001, subject to this Act and the regulations and such terms and conditions as may be agreed to by the municipality and the operator.

7.(1)On the later of the day this section comes into force and the day subsection 9 (2) of Schedule J to the Red Tape Reduction Act, 1999, being Bill 11 of the 1st Session of the 37th Legislature, comes into force, subsection 6.5 (1.1) of the Act, as enacted by section 9 of Schedule J to the Red Tape Reduction Act, 1999, is amended by striking out the portion before clause (a) and substituting the following:

Where selection required

(1.1)A person shall be selected in accordance with this section to provide land ambulance services in an upper-tier municipality if, during the protection period or the transition period,

. . . . .

(2)On the later of the day this section comes into force and the day subsection 9 (2) of Schedule J to the Red Tape Reduction Act, 1999, being Bill 11 of the 1st Session of the 37th Legislature, comes into force, clause 6.5 (1.1) (c) of the Act, as enacted by section 9 of Schedule J to the Red Tape Reduction Act, 1999, is repealed and the following substituted:

(c)in the case of a municipality that has assumed responsibility for the proper provision of land ambulance services in the municipality under subsection 6 (7) or has acquired that responsibility under subsection 6.4 (5) or (8.4), the agreement between the municipality and an operator for the provision of land ambulance services is terminated or expires and is not renewed; or

. . . . .

(3)Subsection 6.5 (2) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is amended by striking out ``If during the protection period" at the beginning and substituting ``If during the protection period or the transition period".

(4)Clause 6.5 (2) (b) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is repealed and the following substituted:

(b)if the municipality has assumed responsibility for the proper provision of land ambulance services in the municipality under subsection 6 (7) or has acquired that responsibility under subsection 6.4 (5) or (8.4), by the municipality.

(5)Subsection 6.5 (7) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is repealed.

8.(1)Subsection 6.6 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is repealed and the following substituted:

Province to pay during protection and transition periods

(1)Subject to subsections (3) and (8), during the protection period and the transition period, the Province of Ontario shall pay for all costs associated with the provision of land ambulance services in upper-tier municipalities.

(2)Subsection 6.6 (3) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is repealed and the following substituted:

Reimbursement

(3)Except as otherwise provided by regulation, each upper-tier municipality shall reimburse the Province in an amount equal to the amount payable by the Province under subsection (1) less the amount of any grant made to the municipality under subsection 4 (3).

(3)Subsection 6.6 (8) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 30, Schedule A, section 6, is repealed and the following substituted:

Where municipality to pay directly

(8)Except as otherwise provided by regulation and subject to any grant made to the municipality under subsection 4 (3), an upper-tier municipality shall pay for all the costs associated with the provision of land ambulance services in the municipality if,

(a)the municipality assumes responsibility for the proper provision of land ambulance services under subsection 6 (7); or

(b)the municipality becomes responsible for the proper provision of land ambulance services in accordance with subsection 6.4 (5) or (8.4).

9.Subsection 22 (1) of the Act, as amended by the Statutes of Ontario, 1996, chapter 32, section 59, 1997, chapter 15, section 1 and 1997, chapter 30, Schedule A, section 18, is further amended by adding the following clause:

(0.a)governing grants made under subsection 4 (3), including,

(i)determining the amount of the grants or providing the method of determining the amount of the grants,

(ii)respecting the portion of the costs associated with the provision of land ambulance services for which a grant may be made and determining the amount of that portion or providing that the amount be determined by the Minister, and

(iii)prescribing terms and conditions under which a grant may be made and providing that the Minister may impose terms and conditions.

Commencement

10.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Sections 1 to 9 come into force on a day to be named by proclamation of the Lieutenant Governor.

Part II

Assessment Act

11.Section 19 of the Assessment Act, as amended by the Statutes of Ontario, 1997, chapter 5, section 12, 1997, chapter 29, section 9, 1998, chapter 33, section 5 and 1999, chapter 6, section 2, is further amended by adding the following subsections:

Same

(2.1)The Minister may make regulations providing that the current value of land must be determined in the manner specified in the regulations.

Same

(2.2)A regulation under subsection (2.1) may be general or specific and may apply to specific properties or types of properties in a municipality or in a portion of a municipality.

12.(1)Subsections 19.0.1 (1), (2) and (3) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 15, Schedule E, section 1, are repealed and the following substituted:

Electricity generating and transformer stations

(1)For the purposes of this Act, the assessed value of generating station buildings or structures or transformer station buildings or structures situated on land owned by a designated electricity utility or municipal electricity utility shall be determined on the basis of $86.11 for each square metre of inside ground floor area of the actual building or structure housing the generating, transforming and auxiliary equipment and machinery.

Same

(1.1)Subsection (1) does not apply for the purpose of determining the assessed value of,

(a)the land on which the buildings and structures described in subsection (1) are situated; or

(b)the buildings or structures on that land other than those described in subsection (1).

No reduction in taxes

(2)The taxes payable for municipal and school purposes on a building or structure to which subsection (1) applies, determined on an annual basis and payable by the owner, shall not be less than the amount of taxes payable for municipal and school purposes on that building or structure in 1998.

Payments under s. 27

(3)The reference in subsection (2) to taxes payable for municipal and school purposes shall be deemed to include payments under subsection 27 (3) and payments under section 52 of the Power Corporation Act.

(2)Section 19.0.1 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 15, Schedule E, section 1, is amended by adding the following subsection:

Deemed ownership

(6)For the purposes of subsection (1), a generating station building or structure or a transformer station building or structure shall be deemed to be owned by a designated electricity utility or a municipal electricity utility if the land is owned by the Crown or a municipality and occupied by the designated electricity utility or the municipal electricity utility.

13.(1)Subsection 39.1 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 5, section 25 and amended by 1997, chapter 43, Schedule G, section 18, is further amended by adding at the end ``no later than December 31 of the year in respect of which the request is made".

(2)Subsection 39.1 (4) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 6, section 25 and amended by 1997, chapter 43, Schedule G, section 18, is repealed and the following substituted:

If no settlement

(4)If the assessment corporation is satisfied that no settlement is possible,

(a)the assessment corporation shall notify the person making the request of that determination before the expiry of the time limit for making a complaint to the Assessment Review Board under subsection 40 (2); or

(b)if it is not practicable for the assessment corporation to notify the person before the time limit referred to in clause (a), the assessment corporation shall notify the person of that determination as soon as is practicable.

(3)Section 39.1 of the Act, as enacted by the Statutes of Ontario, 1997, chapter 5, section 25 and amended by 1997, chapter 43, Schedule G, section 18, is further amended by adding the following subsection:

When change may be made

(8.1)For the purposes of subsections (7) and (8), a change to the assessment roll may be made at any time in the year in respect of which a request is made or in the following year.

14.Section 40 of the Act, as amended by the Statutes of Ontario 1997, chapter 5, section 26, 1997, chapter 23, section 1, 1997, chapter 29, section 21, 1997, chapter 43, Schedule G, section 18, 1998, chapter 3, section 10 and 1998, chapter 33, section 8, is further amended by adding the following subsections:

Deemed complaints, 1999, etc.

(14.1)If a complaint relates to the 1999 taxation year and subsection (14) does not apply, the complainant shall be deemed to have made the same complaint,

(a)in relation to assessments under sections 33 and 34 for the 1999 taxation year; and

(b)in relation to the assessment, including assessments under sections 33 and 34, for the 2000 taxation year if the complaint is not finally disposed of before the last day for complaining with respect to that taxation year.

. . . . .

Change of ownership

(16.1)For the purposes of subsections (14), (14.1) and (15), if a complaint is made in respect of a property, the complainant is the owner of the property and there is a change of ownership before the complaint for the year is finally disposed of, the reference to the complainant in the subsection shall be deemed to be a reference to the owner of the property at the relevant time.

15.Section 43.1 of the Act, as enacted by the Statutes of Ontario, 1997, chapter 5, section 28, is amended by adding the following subsection:

Time for appeal

(2)An application for leave to appeal under this section shall be made within 30 days of the mailing of the decision of the Assessment Review Board.

Commencement

16.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 12 shall be deemed to have come into force on April 1, 1999.

Part III

Capital Investment Plan Act, 1993

17.Section 8 of the Capital Investment Plan Act, 1993 is amended by adding the following subsection:

Exception

(6)Subsections (1), (2), (3) and (5) do not apply with respect to the Ontario Realty Corporation.

18.Subsection 9 (3) of the Act is repealed and the following substituted:

Definition, ``employee"

(3)For the purposes of this section,

``employee" means,

(a)in relation to a corporation other than the Ontario Realty Corporation, an employee employed under the Public Service Act, and

(b)in relation to the Ontario Realty Corporation, any employee.

19.The Act is amended by adding the following section:

Employment matters

63.1(1)A public servant employed at the Corporation immediately before this section comes into force ceases to be a public servant and ceases to be employed by the Crown when this section comes into force.

Same

(2)A public servant who accepts an offer of employment with the Corporation after the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent and before this section comes into force is an employee of the Corporation when this section comes into force.

Bargaining agents

(3)The bargaining agents that represent public servants described in this section for collective bargaining purposes immediately before this section comes into force cease to represent them when this section comes into force.

Same

(4)Subsection (3) does not prevent a trade union from being certified under the Labour Relations Act, 1995 as the bargaining agent for employees of the Corporation. Nor does it prevent the Corporation from entering into an agreement to recognize a trade union as the bargaining agent for employees of the Corporation.

Implementation

(5)The Crown, the Corporation and any person acting on behalf of either of them does not contravene the Crown Employees Collective Bargaining Act, 1993 or the Labour Relations Act, 1995 by taking a step that is contemplated by this section.

Same

(6)The Grievance Settlement Board shall not make an order under the Crown Employees Collective Bargaining Act, 1993 or under any other authority,

(a)that directly or indirectly continues the employment after this section comes into force of a public servant who ceases to be employed by the Crown by virtue of subsection (1) when this section comes into force; or

(b)that directly or indirectly continues after this section comes into force the status of a trade union as the bargaining agent for the public servants described in this section.

Same

(7)An order prohibited by subsection (6) is void to the extent of the prohibition.

Commencement

20.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Sections 17, 18 and 19 come into force on a day to be named by proclamation of the Lieutenant Governor.

Part IV

Commodity Futures Act

21.The Commodity Futures Act is amended by striking out ``self-regulatory body" and ``self-regulatory bodies" wherever they occur and substituting in each case ``self-regulatory organization" and ``self-regulatory organizations", as the case may be.

22.(1)Section 1 of the Act is amended by adding the following definitions:

``market participant" means a registrant, a person or company exempted from the requirement to be registered under this Act by a ruling of the Commission, a recognized clearing house, a registered commodity futures exchange, a recognized commodity futures exchange, a recognized self-regulatory organization, the Canadian Investor Protection Fund, the Toronto Futures Exchange Contingency Fund, the general partner of a market participant or any other person or company or member of a class of persons or companies designated by the regulations; (``participant au march")

``Ontario commodity futures law" means,

(a)this Act,

(b)the regulations, and

(c)in respect of a person or company, a decision of the Commission or a Director to which the person or company is subject; (``droit ontarien des contrats terme sur marchandises")

``recognized clearing house" means a clearing house recognized by the Commission under subsection 17 (1); (``chambre de compensation reconnue")

``recognized commodity futures exchange" means a person or company that is recognized by the Commission as a commodity futures exchange under this Act or that is exempted from the requirement to be recognized by order of the Commission; (``Bourse reconnue de contrats terme sur marchandises")

``recognized self-regulatory organization" means a self-regulatory organization recognized by the Commission under subsection 16 (1); (``organisme d'autorglementation reconnu")

``registered commodity futures exchange" means a person or company that is registered by the Commission as a commodity futures exchange under this Act; (``Bourse inscrite de contrats terme sur marchandises")

``rules" means,

(a)the rules made under section 66, and

(b)the orders and rulings listed in the Schedule to this Act; (``rgles")

``self-regulatory organization" means a person or company that represents registrants and is organized for the purpose of regulating the operations and standards of practice and business conduct of its members and their representatives with a view to promoting the protection of investors and the public interest. (``organisme d'autorglementation")

(2)The definitions of ``commodity futures exchange", ``decision", ``Director", ``Minister", ``misrepresentation" and ``regulations" in section 1 of the Act are repealed and the following substituted:

``commodity futures exchange" means an association or organization, whether incorporated or unincorporated, operated for the purpose of providing the facilities necessary for the trading of contracts; (``Bourse de contrats terme sur marchandises")

``decision" means, in respect of a decision of the Commission or a Director, a direction, decision, order, ruling or other requirement made under a power or right conferred by this Act or the regulations; (``dcision")

``Director" means the Executive Director of the Commission, a Director or Deputy Director of the Commission, or a person employed by the Commission in a position designated by the Executive Director for the purpose of this definition; (``directeur")

``Minister" means the Minister of Finance or other member of the Executive Council to whom the administration of this Act may be assigned; (``ministre")

``misrepresentation" means,

(a)an untrue statement of material fact, or

(b)an omission to state a material fact that is required to be stated or that is necessary to make a statement not misleading in the light of the circumstances in which it was made; (``prsentation inexacte des faits")

``regulations" means the regulations made under this Act and, unless the context otherwise indicates, includes the rules. (``rglements")

(3)The definition of ``officer" in section 1 of the Act is amended by adding ``or any individual acting in a similar capacity on behalf of a registrant" after ``authority" at the end.

(4)The definition of ``register" in section 1 of the Act is repealed.

(5)Section 1 of the Act is amended by adding the following subsection:

Same

(2)For the purposes of this Act, the regulations and the rules, any of ``future-oriented financial information" and ``non-redeemable investment fund" may be defined in the regulations or the rules and if so defined shall have the defined meaning.

23.The Act is amended by adding the following section:

Purposes

1.1(1)The purposes of this Act are,

(a)to provide protection to investors from unfair, improper or fraudulent practices; and

(b)to foster fair and efficient commodity futures markets and confidence in those markets.

Principles to consider

(2)In pursuing the purposes of this Act, the Commission shall have regard to the following fundamental principles:

1.Balancing the importance to be given to each of the purposes of this Act may be required in specific cases.

2.The primary means for achieving the purposes of this Act are,

i.requirements for timely, accurate and efficient disclosure of information,

ii.restrictions on fraudulent and unfair market practices and procedures, and

iii.requirements for the maintenance of high standards of fitness and business conduct to ensure honest and responsible conduct by market participants.

3.Effective and responsive commodity futures regulation requires timely, open and efficient administration and enforcement of this Act by the Commission.

4.The Commission should, subject to an appropriate system of supervision, use the enforcement capability and regulatory expertise of recognized self-regulatory organizations.

5.The integration of commodity futures markets is supported and promoted by the sound and responsible harmonization and co-ordination of commodity futures regulation regimes.

6.Business and regulatory costs and other restrictions on the business and investment activities of market participants should be proportionate to the significance of the regulatory objectives sought to be realized.

24.The Act is amended by adding the following Part:

Part I.1

Commission

Responsibility for administration of Act

2.1(1)The Commission is responsible for the administration of this Act.

Eligibility to sit on hearing

(2)No member who exercises a power or performs a duty of the Commission under Part IV, except section 13, in respect of a matter under investigation or examination shall sit on a hearing by the Commission that deals with the matter, except with the written consent of the parties to the proceeding.

25.Subsection 3 (2) of the Act is amended by striking out ``subsections 7 (3) and (4) apply" in the second last line and substituting ``subsection 9 (1) applies".

26.The Act is amended by adding the following Part:

Part II.1

Executive Director and Secretary

Assignment of powers and duties

3.1(1)A quorum of the Commission may assign any of its powers and duties under this Act, except powers and duties under section 4 and Part IV, to the Executive Director or to another Director.

Same

(2)The Executive Director may assign any of his or her powers and duties to another Director, other than powers and duties assigned to the Executive Director by the Commission.

Revocation of assignment

(3)The Commission may revoke, in whole or in part, an assignment of powers and duties made under subsection (1) and the Executive Director may revoke, in whole or in part, an assignment of powers and duties made under subsection (2).

Terms and conditions

(4)An assignment under this section may be subject to such terms and conditions as are set out in the assignment.

Powers and duties of the Secretary

3.2(1)The Secretary,

(a)may accept service of all notices and other documents on behalf of the Commission;

(b)when authorized by the Commission, may sign a decision made by the Commission as a result of a hearing;

(c)may certify under his or her hand a decision made by the Commission or a document, record or thing used in connection with a hearing by the Commission if certification is required for a purpose other than that stated in subsection 5 (3);

(d)may exercise such other powers as are vested in the Secretary by this Act or the regulations; and

(e)shall perform such duties as are imposed on the Secretary by this Act or the regulations or by the Commission.

Acting Secretary

(2)If the Secretary is absent for any reason, the Commission may designate another individual to act in the capacity of Secretary and the individual designated has all the powers and duties of the Secretary.

Certification by Secretary

(3)A certificate purporting to be signed by the Secretary is, without proof of the office or signature, admissible in evidence, so far as it is relevant, for all purposes in any action, prosecution or other proceeding.

27.Subsection 4 (1) of the Act is repealed and the following substituted:

Review of decision

(1)Within 30 days after a decision of the Director, the Commission may notify the Director and any person or company directly affected of its intention to convene a hearing to review the decision.

28.(1)Subsection 5 (1) of the Act is repealed and the following substituted:

Appeal

(1)A person or company directly affected by a final decision of the Commission may appeal to the Divisional Court within 30 days after the later of the making of the final decision or the issuing of the reasons for the final decision.

(2)Subsection 5 (3) of the Act is amended by striking out the portion before clause (a) and substituting the following:

Certification of documents

(3)The Secretary shall certify to the Divisional Court,

. . . . .

(3)Subsection 5 (4) of the Act is repealed and the following substituted:

Respondent on appeal

(4)The Commission is the respondent to an appeal under this section.

Minister

(4.1)The Minister is entitled to be heard by counsel or otherwise on the argument of an appeal under this section, whether or not the Minister is named as a party to the appeal.

29.Section 6 of the Act is repealed.

30.Parts IV, V, VI and VII of the Act are repealed and the following substituted:

Part IV

Investigations and Examinations

Investigation order

7.(1)The Commission may, by order, appoint one or more persons to make such investigation with respect to a matter as it considers expedient,

(a)for the due administration of Ontario commodity futures law or the regulation of the commodity futures markets in Ontario;

(b)with respect to any other matter relating to trading in contracts; or

(c)to assist in the due administration of the commodity futures laws or the regulation of trading in contracts in another jurisdiction.

Contents of order

(2)An order under this section shall describe the matter to be investigated.

Scope of investigation

(3)For the purposes of an investigation under this section, a person appointed to make the investigation may investigate and inquire into,

(a)the affairs of the person or company in respect of which the investigation is being made, including any trades, communications, negotiations, transactions, investigations, loans, borrowings or payments to, by, on behalf of, or in relation to or connected with the person or company and any property, assets or things owned, acquired or alienated, in whole or in part, by the person or company or by any other person or company acting on behalf of, or as agent for, the person or company; and

(b)the assets at any time held, the liabilities, debts, undertakings and obligations at any time existing, the financial or other conditions at any time prevailing in or in relation to or in connection with the person or company, and any relationship that may at any time exist or have existed between the person or company and any other person or company by reason of trades in contracts, investments, commissions promised, secured or paid, interests held or acquired, the loaning or borrowing of money, stock or other property, the transfer or holding of stock, interlocking directorates, common control, undue influence or control or any other relationship.

Right to examine

(4)For the purposes of an investigation under this section, a person appointed to make the investigation may examine any documents or other things, whether they are in the possession or control of the person or company in respect of which the investigation is ordered or of any other person or company.

Minister may order investigation

(5)Despite subsection (1), the Minister may, by order, appoint one or more persons to make such investigation as the Minister considers expedient,

(a)for the due administration of Ontario commodity futures law or the regulation of the commodity futures markets in Ontario;

(b)with respect to any other matter relating to trading in contracts; or

(c)to assist in the due administration of the commodity futures laws or the regulation of trading in contracts in another jurisdiction.

Same

(6)A person appointed under subsection (5) has, for the purpose of the investigation, the same authority, powers, rights and privileges as a person appointed under subsection (1).

Financial examination order

8.(1)The Commission may, by order, appoint one or more persons to make such examination of the financial affairs of a market participant as it considers expedient,

(a)for the due administration of Ontario commodity futures law or the regulation of the commodity futures markets in Ontario;

(b)with respect to any other matter relating to trading in contracts; or

(c)to assist in the due administration of the commodity futures laws or the regulation of trading contracts in another jurisdiction.

Contents of order

(2)An order under subsection (1) shall describe the matter to be examined.

Right to examine

(3)For the purposes of an examination under this section, a person appointed to conduct the examination may examine any documents or other things, whether they are in the possession or control of the market participant or any other person or company.

Power of investigator or examiner

9.(1)A person making an investigation or examination under section 7 or 8 has the same power to summon and enforce the attendance of any person and to compel him or her to testify on oath or otherwise, and to summon and compel any person or company to produce documents and other things, as is vested in the Superior Court of Justice for the trial of civil actions, and the refusal of a person to attend or to answer questions or of a person or company to produce such documents or other things as are in his, her or its custody or possession makes the person or company liable to be committed for contempt by the Superior Court of Justice as if in breach of an order of that court.

Rights of witness

(2)A person or company giving evidence under subsection (1) may be represented by counsel and may claim any privilege to which the person or company is entitled.

Inspection

(3)A person making an investigation or examination under section 7 or 8 may, on production of the order appointing him or her, enter the business premises of any person or company named in the order during business hours and inspect any documents or other things that are used in the business of that person or company and that relate to the matters specified in the order, except those maintained by a lawyer in respect of his or her client's affairs.

Authorization to search

(4)A person making an investigation or examination under section 7 or 8 may apply to a judge of the Superior Court of Justice in the absence of the public and without notice for an order authorizing the person or persons named in the order to enter and search any building, receptacle or place specified and to seize anything described in the authorization that is found in the building, receptacle or place and to bring it before the judge granting the authorization or another judge to be dealt with by him or her according to law.

Grounds

(5)No authorization shall be granted under subsection (4) unless the judge to whom the application is made is satisfied on information under oath that there are reasonable and probable grounds to believe that there may be in the building, receptacle or place to be searched anything that may reasonably relate to the order made under section 7 or 8.

Power to enter, search and seize

(6)A person named in an order under subsection (4) may, on production of the order, enter any building, receptacle or place specified in the order between 6 a.m. and 9 p.m., search for and seize anything specified in the order, and use as much force as is reasonably necessary for that purpose.

Expiration

(7)Every order under subsection (4) shall name the date that it expires, and the date shall be not later than 15 days after the order is granted.

Application

(8)Sections 159 and 160 of the Provincial Offences Act apply to searches and seizures under this section with such modifications as the circumstances require.

Private residence

(9)In subsections (4), (5) and (6),

``building, receptacle or place" does not include a private residence.

Copying

10.(1)Anything seized or produced under this Part shall be made available for inspection and copying by the person or company from which it was obtained, if practicable.

Return

(2)Anything seized or produced under this Part shall be returned to the person or company from which it was obtained when,

(a)retention is no longer necessary for the purposes of an investigation, examination, proceeding or prosecution; or

(b)the Commission so orders.

Report of investigation or examination

11.(1)A person appointed under subsection 7 (1) or 8 (1) shall, at the request of the Chair of the Commission or of a member of the Commission involved in making the appointment, provide a report to the Chair or member, as the case may be, or any testimony given and any documents or other things obtained under section 9.

Same

(2)A person appointed under subsection 7 (5) shall, at the request of the Chair of the Commission, provide a report to the Chair or any testimony given and any documents or other things obtained under section 9.

Report privileged

(3)A report provided under this section is privileged.

Non-disclosure

12.(1)Except in accordance with section 13, no person or company shall disclose at any time, except to his, her or its counsel,

(a)the nature or content of an order under section 7 or 8; or

(b)the name of any person examined or sought to be examined under section 9, any testimony given under section 9, any information obtained under section 9, the nature or content of any questions asked under section 9, the nature or content of any demands for the production of any document or other thing under section 9 or the fact that any document or other thing was produced under section 9.

Confidentiality

(2)Any report provided under section 11 and any testimony given or documents or other things obtained under section 9 shall be for the exclusive use of the Commission and shall not be disclosed or produced to any other person or company or in any other proceeding except in accordance with section 13.

Disclosure by Commission

13.(1)If the Commission considers that it would be in the public interest, it may make an order authorizing the disclosure to any person or company of,

(a)the nature and content of an order under section 7 or 8;

(c)all or part of a report provided under section 11.

Opportunity to object

(2)No order shall be made under subsection (1) unless the Commission has, where practicable, given reasonable notice and an opportunity to be heard to,

(a)persons and companies named by the Commission; and

(b)in the case of disclosure of testimony given or information obtained under section 9, the person or company that gave the testimony or from which the information was obtained.

Disclosure to police

(3)Without the written consent of the person from whom the testimony was obtained, no order shall be made under subsection (1) authorizing the disclosure of testimony given under subsection 9 (1) to,

(a)a municipal, provincial, federal or other police force or to a member of a police force; or

(b)a person responsible for the enforcement of the criminal law of Canada or of any other country or jurisdiction.

Terms and conditions

(4)An order under subsection (1) may be subject to terms and conditions imposed by the Commission.

Disclosure by court

(5)A court having jurisdiction over a prosecution under the Provincial Offences Act initiated by the Commission may compel production to the court of any testimony given or any document or other thing obtained under section 9, and after inspecting the testimony, document or thing and providing all interested parties with an opportunity to be heard, the court may order the release of the testimony, document or thing to the defendant if the court determines that it is relevant to the prosecution, is not protected by privilege and is necessary to enable the defendant to make full answer and defence, but the making of an order under this subsection does not determine whether the testimony, document or thing is admissible in the prosecution.

Disclosure in investigation or proceeding

(6)A person appointed to make an investigation or examination under this Act may, for the purpose of conducting an examination or in connection with a proceeding commenced or proposed to be commenced by the Commission under this Act, disclose or produce anything mentioned in subsection (1).

Disclosure to police

(7)Without the written consent of the person from whom the testimony was obtained, no disclosure shall be made under subsection (6) of testimony given under subsection 9 (1) to,

(a)a municipal, provincial, federal or other police force or to a member of a police force; or

(b)a person responsible for the enforcement of the criminal law of Canada or of any other country or jurisdiction.

Prohibition on use of compelled testimony

(8)Testimony given under section 9 shall not be admitted in evidence against the person from whom the testimony was obtained in a prosecution for an offence under section 55 or in any other prosecution governed by the Provincial Offences Act.

Part V

Record-Keeping and Compliance Reviews

Record-keeping

14.(1)Every market participant shall keep such books, records and other documents as are necessary for the proper recording of its business transactions and financial affairs and the transactions that it executes on behalf of others and shall keep such other books, records and documents as may otherwise be required under Ontario commodity futures law.

Record of transaction

(2)Without limiting the generality of subsection (1), every registered commodity futures exchange shall keep a record of the time at which each transaction on such commodity futures exchange took place and shall supply to any client of a member of such commodity futures exchange, on production of a written confirmation of a transaction with the member, particulars of the time at which the transaction took place and verification or otherwise of the matters set forth in the written confirmation.

Provision of information to Commission

(3)Every market participant shall deliver to the Commission at such time or times as the Commission or any member, employee or agent of the Commission may require,

(a)any of the books, records and documents that are required to be kept by the market participant under Ontario commodity futures law; and

(b)except where prohibited by law, any filings, reports or other communications made to any other regulatory agency whether within or outside of Ontario.

Compliance reviews

14.1(1)The Commission may designate in writing one or more persons to review the books, records and documents that are required to be kept by a market participant under section 14 for the purpose of determining whether Ontario commodity futures law is being complied with.

Powers of compliance reviewer

(2)A person conducting a compliance review under this section may, on production of his or her designation,

(a)enter the business premises of any market participant during business hours; and

(b)inquire into and examine the books, records and documents of the market participant that are required to be kept under section 14, and make copies of the books, records and documents.

Fees

(3)A market participant in respect of which a compliance review is conducted under this section shall pay the Commission such fees as may be prescribed by the regulations.

Part VI

Self-Regulation

Commodity futures exchanges

15.(1)No person or company shall carry on business as a commodity futures exchange in Ontario unless registered by the Commission under this section.

Registration

(2)The Commission shall, on the application of a person or company proposing to carry on business as a commodity futures exchange in Ontario, register the person or company if the Commission is satisfied that to do so would be in the public interest.

Same

(3)A registration under this section shall be made in writing and shall be subject to such terms and conditions as the Commission may impose.

Factors

(4)In making its decision as to whether registration under this section is in the public interest, the Commission shall take into account whether,

(a)the clearing and other arrangements made and the financial condition of the commodity futures exchange, its clearing house and its members are such as to provide reasonable assurance that all obligations arising out of contracts entered into on such commodity futures exchange will be met;

(b)the rules and regulations applicable to exchange members and clearing house members are in the public interest, are actively enforced and permit the commodity futures exchange to maintain orderly trading in its markets;

(c)trading practices are fair and properly supervised;

(d)adequate measures have been taken to prevent manipulation and excessive speculation;

(e)adequate provision has been made to record and publish details of trading, including volume and open interest; and

(f)the commodity futures exchange has satisfied or can satisfy all conditions prescribed under the regulations for the conduct of the business of a commodity futures exchange.

Right to be heard

(5)The Commission shall not refuse to grant registration to a commodity futures exchange for the purposes of subsection (2) without giving the applicant an opportunity to be heard.

Filings

(6)Every registered commodity futures exchange shall file with the Commission all by-laws, rules, regulations, policies, procedures, interpretations and practices as soon as practicable and in any event within five days of the date on which the by-law, rule, regulation, policy, procedure, interpretation or practice is approved by the Board of Directors of the commodity futures exchange and prior to approval by the membership of the commodity futures exchange.

Commission's powers

(7)The Commission may, if it appears to be in the public interest, make any decision,

(a)with respect to the manner in which a registered commodity futures exchange carries on business;

(b)with respect to any by-law, rule, regulation, policy, procedure, interpretation or practice of a registered commodity futures exchange or its clearing house; or

(c)with respect to trading on or through the facilities of a registered commodity futures exchange or with respect to any contract traded on a registered commodity futures exchange, including the setting of levels of margin, daily price limits, daily trading limits and position limits.

Self-regulatory organizations

16.(1)The Commission may, on application of a self-regulatory organization, recognize the self-regulatory organization if the Commission is satisfied that to do so would be in the public interest and that the self-regulatory organization has satisfied or can satisfy all conditions with respect to self-regulatory bodies prescribed under the regulation.

Same

(2)A recognition under this section shall be made in writing and shall be subject to such terms and conditions as the Commission may impose.

Standards and conduct

(3)A recognized self-regulatory organization shall, subject to Ontario commodity futures law, regulate the operations and the standards of practice and business conduct of its members and their representatives in accordance with its by-laws, rules, regulations, policies, procedures, interpretations and practices.

Commission's powers

(4)The Commission may, if it is satisfied that to do so would be in the public interest, make any decision with respect to any by-law, rule, regulation, policy, procedure, interpretation or practice of a recognized self-regulatory organization.

Clearing houses

17.(1)The Commission may, on the application of a person or company carrying on or proposing to carry on the business of a clearing house for a commodity futures exchange registered pursuant to subsection 15 (2), recognize the clearing house, if the Commission is satisfied that to do so would be in the public interest and that the clearing house has satisfied or can satisfy all conditions with respect to clearing houses prescribed under the regulation.

Same

(2)A recognition under this section shall be made in writing and shall be subject to such terms and conditions as the Commission may impose.

Filings

(3)Every recognized clearing house shall file with the Commission copies of all constating documents, and any general agreement with its members, and copies of all by-laws, rules, regulations, procedures and policies, and any amendments thereto, relating to trading in contracts, as soon as practicable and in any event within five days of the date on which the by-law, rule, regulation, procedure or policy, or any amendment thereto, is approved by the Board of Directors of the recognized clearing house and prior to approval by its membership.

Commission's powers

(4)The Commission may, if it is satisfied that to do so would be in the public interest, make any decision,

(a)with respect to any constating document, general agreement with its members, by-law, rule, regulation, procedure, policy, interpretation or practice of a recognized clearing house; or

(b)with respect to the manner in which any recognized clearing house carries on its business.

Council, committee or ancillary body

18.(1)A registered commodity futures exchange or a recognized self-regulatory organization may, with the prior approval of the Commission and on such terms and conditions as the Commission may determine to be necessary or appropriate in the public interest, establish a council, committee or other ancillary body to which it assigns regulatory or self-regulatory powers or responsibilities, or both.

Same

(2)A council, committee or ancillary body that exercises the powers or assumes the responsibilities of a registered commodity futures exchange or recognized self-regulatory organization is also included in,

(a)the registration or recognition of the registered commodity futures exchange or recognized self-regulatory organization;

(b)any suspension, restriction or termination of the registration or recognition of the registered commodity futures exchange or recognized self-regulatory organization; and

(c)any imposition of terms or conditions on the registration or recognition of the registered commodity futures exchange or recognized self-regulatory organization.

Same

(3)The provisions of Ontario commodity futures law that apply to registered commodity futures exchanges and recognized self-regulatory organizations also apply with necessary modifications to the council, committee or ancillary body.

Voluntary surrender

19.On application by a registered commodity futures exchange, recognized self-regulatory organization or recognized clearing house, the Commission may accept, on such terms and conditions as it may impose, the voluntary surrender of the registration of the commodity futures exchange, or of the recognition of the self-regulatory organization or clearing house, if the Commission is satisfied that the surrender of the registration or recognition would not be prejudicial to the public interest.

Assignment of powers and duties

20.(1)The Commission may, on such terms and conditions as it may impose, assign to a registered commodity futures exchange or recognized self-regulatory organization any of the powers and duties of the Commission under Part VIII or the regulations related to that Part.

Same

(2)The Executive Director may, with the approval of the Commission, assign to a registered commodity futures exchange or recognized self-regulatory organization any of the powers and duties of the Director under Part VIII or the regulations related to that Part.

Revocation of assignment

(3)The Commission or, with the approval of the Commission, the Executive Director may at any time revoke, in whole or in part, an assignment of powers and duties made under this section.

Contravention of Ontario commodity futures law

21.No by-law, rule, regulation, policy, procedure, interpretation or practice of a registered commodity futures exchange, recognized self-regulatory organization or recognized clearing house shall contravene Ontario commodity futures law, but a registered commodity futures exchange, recognized self-regulatory organization or recognized clearing house may impose additional requirements within its jurisdiction.

Review of decisions

21.1(1)The Executive Director or a person or company directly affected by, or by the administration of, a direction, decision, order or ruling made under a by-law, rule, regulation, policy, procedure, interpretation, direction or practice of a registered commodity futures exchange, recognized self-regulatory organization or a recognized clearing house may apply to the Commission for a hearing and review of the direction, decision, order or ruling.

Procedure

(2)Section 4 applies to the hearing and review of the direction, decision, order or ruling in the same manner as it applies to a hearing and review of a decision of the Director.

Registered commodity futures exchange auditor

21.2(1)Every registered commodity futures exchange shall appoint an auditor for the exchange.

Recognized self-regulatory organization auditor

(2)At the request of the Commission, a recognized self-regulatory organization shall appoint an auditor for the self-regulatory organization.

Auditor of member

21.3(1)Every registered commodity futures exchange and every recognized self-regulatory organization shall cause each of its members to appoint an auditor.

Selection of auditor

(2)The auditor of a member shall be chosen from the panel of auditing firms selected under subsection (3).

Panel of auditors

(3)Every registered commodity futures exchange and every recognized self-regulatory organization shall select a panel of auditing firms for their members.

Auditor

(4)No person shall be appointed as an auditor under subsection (1) unless the person has practised as an auditor in Canada for five years or more.

Examination and report

(5)The auditor of a member shall make an examination, in accordance with generally accepted auditing standards, of the annual financial statements and regulatory filings of the member as called for by the by-laws, rules, regulations, policies, procedures, interpretations, directions or practices applicable to the member, and shall report on the financial affairs of the member to the registered commodity futures exchange or recognized self-regulatory organization, as the case may be, in accordance with professional reporting standards.

Auditor of registrant

21.4(1)Every registered dealer and registered adviser that is not subject to section 21.3 shall appoint an auditor who satisfies such requirements as may be established by the Commission.

Examination and report

(2)The auditor of a registered dealer or registered adviser that is not subject to section 21.3 shall make an examination of the annual financial statements and other regulatory filings of the registered dealer or registered adviser, in accordance with generally accepted auditing standards, and shall prepare a report on the financial affairs of the registered dealer or registered adviser in accordance with professional reporting standards.

Filing with Commission

(3)The registered dealer or registered adviser shall file the report with the Commission, together with its annual financial statements and other regulatory filings.

Delivery of financial statements

(4)A registered dealer or registered adviser that is not subject to section 21.3 shall deliver to the Commission annual audited financial statements, prepared in accordance with generally accepted accounting principles, and other regulatory filings as prescribed by the regulations, within 90 days after the end of its financial year or as otherwise prescribed by the regulations.

Certification of financial statements

(5)The annual financial statements and regulatory filings delivered to the Commission shall be certified by the registered dealer or registered adviser or an officer or partner of the registered dealer or registered adviser.

Additional information

(6)The registered dealer or registered adviser shall deliver to the Commission such other information as the Commission may require in such form as it may require.

31.(1)Clause 22 (1) (b) of the Act is amended by inserting ``as a representative or" before ``as a partner" in the third line.

(2)Subsection 22 (1) of the Act, as amended by the Statutes of Ontario, 1997, chapter 19, section 1, is further amended by striking out ``this Act and the regulations" in the second line of the portion following clause (b) and substituting ``Ontario commodity futures law".

32.Section 24 of the Act is repealed and the following substituted:

Surrender

24.On application by a registrant, the Commission may accept, subject to such terms and conditions as it may impose, the voluntary surrender of the registration of the registrant if the Commission is satisfied that the financial obligations of the registrant to his, her or its clients have been discharged and the surrender of the registration would not be prejudicial to the public interest.

33.Section 29 of the Act is repealed.

34.Section 30 of the Act, as amended by the Statutes of Ontario, 1997, chapter 19, section 1, is repealed.

35.Clause 31 (a) of the Act is amended by inserting after ``Loan and Trust Corporations Act" in the third last line ``or a credit union or league to which the Credit Unions and Caisses Populaires Act, 1994 applies".

36.Part XI of the Act is repealed.

37.(1)Subsection 48 (1) of the Act is amended by,

(a)striking out ``The Director" at the beginning and substituting ``The Commission"\; and

(b)inserting ``or described" after ``named" in the fourth line.

(2)Subsection 48 (2) of the Act is repealed and the following substituted:

Hearing

(2)The Commission shall not make an order under subsection (1) without giving the person or company affected an opportunity to be heard.

38.Subsection 54 (4) of the Act is repealed.

39.Sections 55 and 56 of the Act are repealed and the following substituted:

Offences, general

55.(1)Every person or company that,

(a)makes a statement in any material, evidence or information submitted to the Commission, a Director, any person acting under the authority of the Commission or the Executive Director or any person appointed to make an investigation or examination under this Act that, in a material respect and at the time and in the light of the circumstances under which it is made, is misleading or untrue or does not state a fact that is required to be stated or that is necessary to make the statement not misleading;

(b)makes a statement in any application, release, report, return, financial statement or other document required to be filed or furnished under Ontario commodity futures law that, in a material respect and at the time and in the light of the circumstances under which it is made, is misleading or untrue or does not state a fact that is required to be stated or that is necessary to make the statement not misleading; or

(c)contravenes Ontario commodity futures law,

is guilty of an offence and on conviction is liable to a fine of not more than $1,000,000 or to imprisonment for a term of not more than two years, or to both.

Defence

(2)Without limiting the availability of other defences, no person or company is guilty of an offence under clause (1) (a) or (b) if the person or company did not know and in the exercise of reasonable diligence could not have known that the statement was misleading or untrue or that it omitted to state a fact that was required to be stated or that was necessary to make the statement not misleading in light of the circumstances in which it was made.

Directors and officers

(3)Every director or officer of a company or of a person other than an individual who authorizes, permits or acquiesces in the commission of an offence under subsection (1) by the company or person, whether or not a charge has been laid or a finding of guilt has been made against the company or person in respect of the offence under subsection (1), is guilty of an offence and is liable on conviction to a fine of not more than $1,000,000 or to imprisonment for a term of not more than two years, or to both.

Consent of the Commission

(4)No proceeding under this section shall be commenced except with the consent of the Commission.

Trial by provincial judge

(5)The Commission or an agent for the Commission may by notice to the clerk of the court having jurisdiction in respect of an offence under this Act require that a provincial judge preside over the proceeding.

40.Subsection 58 (1) of the Act, as amended by the Statutes of Ontario, 1997, chapter 19, section 1, is further amended by striking out ``Ontario Court (Provincial Division)" in the sixth and seventh lines and substituting ``Ontario Court of Justice".

41.Sections 59 and 60 of the Act are repealed and the following substituted:

Interim preservation of property

59.(1)If the Commission considers it expedient,

(a)for the due administration of Ontario commodity futures law or the regulation of the commodity futures markets in Ontario; or

(b)to assist in the due administration of the commodity futures laws or the regulation of the commodity futures markets in another jurisdiction,

the Commission may,

(c)direct a person or company having on deposit or under its control or for safekeeping any funds, securities or property of any person or company to retain those funds, securities or property and to hold them until the Commission in writing revokes the direction or consents to release a particular fund, security or property from the direction, or until the Superior Court of Justice orders otherwise; or

(d)direct a person or company holding or having under its control a contract of any person or company, to liquidate the contract and to retain the proceeds of liquidation and to hold them until the Commission in writing revokes the direction or consents to release a particular amount from the direction, or until the Superior Court of Justice orders otherwise.

Application

(2)A direction under subsection (1) that names a bank or other financial institution shall apply only to the branches of the bank or other financial institution identified in the direction.

Exclusions

(3)A direction under subsection (1) shall not apply to funds, securities or property in a recognized clearing house or to securities in process of transfer by a transfer agent unless the direction so states.

Certificate of pending litigation

(4)The Commission may order that a direction under subsection (1) be certified to a land registrar or mining recorder and that it be registered or recorded against the lands or claims identified in the direction, and on registration or recording of the certificate it shall have the same effect as a certificate of pending litigation.

Review by court

(5)As soon as practicable and not later than seven days after a direction is issued under subsection (1), the Commission shall apply to the Superior Court of Justice to continue the direction or for such other order as the court considers appropriate.

Notice

(6)A direction under subsection (1) may be made without notice but, in that event, copies of the direction shall be sent forthwith by such means as the Commission may determine to all persons and companies named in the direction.

Clarification or revocation

(7)A person or company directly affected by a direction may apply to the Commission for clarification or to have the direction varied or revoked.

Orders in the public interest

60.(1)The Commission may make one or more of the following orders if, in its opinion, it is in the public interest to make the order or orders:

1.An order that the registration or recognition granted to a person or company under Ontario commodity futures law be suspended or restricted for such period as is specified in the order or be terminated, or that terms and conditions be imposed on the registration or recognition.

2.An order that the acceptance of the form of a contract be revoked.

3.An order that any exemptions contained in Ontario commodity futures law do not apply to a person or company permanently or for such period as is specified in the order.

4.An order that a market participant submit to a review of his, her or its practices and procedures and institute such changes as may be ordered by the Commission.

5.If the Commission is satisfied that Ontario commodity futures law has not been complied with, an order that a release, report, return, financial statement or other document described in the order,

i.be provided by a market participant to a person or company,

ii.not be provided by a market participant to a person or company, or

iii.be amended by a market participant to the extent that amendment is practicable.

6.An order that a person or company be reprimanded.

7.An order that a person resign one or more positions that the person holds as a director or officer of an issuer.

8.An order that a person is prohibited from becoming or acting as a director or officer of any issuer.

Terms and conditions

(2)An order under this section may be subject to such terms and conditions as the Commission may impose.

Hearing requirement

(3)No order shall be made under this section without a hearing, subject to section 4 of the Statutory Powers Procedure Act.

Temporary orders

(4)Despite subsection (3), if in the opinion of the Commission the length of time required to conclude a hearing could be prejudicial to the public interest, the Commission may make a temporary order under paragraph 1, 2 or 3 of subsection (1) or subparagraph 5 ii of subsection (1).

Period of temporary order

(5)The temporary order shall take effect immediately and shall expire on the fifteenth day after its making unless extended by the Commission.

Extension of temporary order

(6)The Commission may extend a temporary order until the hearing is concluded if a hearing is commenced within the 15-day period.

Same

(7)Despite subsection (6), the Commission may extend a temporary order under paragraph 2 of subsection (1) for such period as it considers necessary if satisfactory information is not provided to the Commission within the 15-day period.

Notice of temporary order

(8)The Commission shall give written notice of every temporary order made under subsection (4), together with a notice of hearing, to any person or company directly affected by the temporary order.

Payment of investigation costs

60.1(1)If, in respect of a person or company whose affairs were the subject of an investigation, the Commission,

(a)is satisfied that the person or company has not complied with, or is not complying with, Ontario commodity futures law; or

(b)considers that the person or company has not acted in the public interest,

the Commission may, after conducting a hearing, order the person or company to pay the costs of the investigation.

Payment of hearing costs

(2)If, in respect of a person or company whose affairs were the subject of a hearing, the Commission, after conducting the hearing,

(a)is satisfied that the person or company has not complied with, or is not complying with, Ontario commodity futures law; or

(b)considers that the person or company has not acted in the public interest,

the Commission may order the person or company to pay the costs of or related to the hearing that are incurred by, or on behalf of, the Commission.

Payment of costs where offence

(3)Where a person or company is guilty of an offence under this Act or the regulations, the Commission may, after conducting a hearing, order the person or company to pay the costs of any investigation carried out in respect of that offence.

Costs

(4)For purposes of subsections (1), (2) and (3), the costs that the Commission may order the person or company to pay include, but are not limited to, all or any of the following:

1.Costs incurred in respect of services provided by persons appointed or engaged under section 3, 7 or 8.

2.Costs of matters preliminary to the hearing.

3.Costs for time spent by the Commission or staff of the Commission.

4.Any fee paid to a witness.

5.Costs of legal services provided to the Commission.

Applications to court

60.2(1)The Commission may apply to the Superior Court of Justice for a declaration that a person or company has not complied with or is not complying with Ontario commodity futures law.

Prior hearing not required

(2)The Commission is not required, before making an application under subsection (1), to hold a hearing to determine whether the person or company has not complied with or is not complying with Ontario commodity futures law.

Remedial powers of court

(3)If the court makes a declaration under subsection (1), the court may, despite the imposition of any penalty under section 55 and despite any order made by the Commission under section 60, make any order that the court considers appropriate against the person or company, including, without limiting the generality of the foregoing, one or more of the following orders:

1.An order that the person or company comply with Ontario commodity futures law.

2.An order requiring the person or company to submit to a review by the Commission of his, her or its practices and procedures and to institute such changes as may be directed by the Commission.

3.An order that a release, report, return, financial statement or any other document described in the order,

i.be provided by the person or company to another person or company,

ii.not be provided by the person or company to another person or company,

iii.be amended by the person or company to the extent that amendment is practicable.

4.An order prohibiting the voting or exercise of any other right attaching to securities by the person or company.

5.An order prohibiting the person from acting as officer or director of any market participant permanently or for such period as is specified in the order.

6.An order appointing officers and directors in place of, or in addition to, all or any of the officers and directors of the company then in office.

7.An order requiring the person or company to produce to the court or an interested person financial statements in the form required by Ontario commodity futures law, or an accounting in such other form as the court may determine.

8.An order directing rectification of the registers or other records of the company.

9.An order requiring the person or company to compensate or make restitution to an aggrieved person or company.

10.An order requiring the person or company to pay general or punitive damages to any other person or company.

11.An order requiring the person or company to disgorge to the Minister any amounts obtained as a result of the non-compliance with Ontario commodity futures law.

12.An order requiring the person or company to rectify any past non-compliance with Ontario commodity futures law to the extent that rectification is practicable.

Interim orders

(4)On an application under this section the court may make such interim orders as it considers appropriate.

Appointment of receiver, etc.

60.3(1)The Commission may apply to the Superior Court of Justice for an order appointing a receiver, receiver and manager, trustee or liquidator of all or any part of the property of any person or company.

Grounds

(2)No order shall be made under subsection (1) unless the court is satisfied that,

(a)the appointment of a receiver, receiver and manager, trustee or liquidator of all or any part of the property of the person or company is in the best interests of the creditors of the person or company or of persons or companies any of whose property is in the possession or under the control of the person or company or the security holders of, or subscribers to, the person or company; or

(b)it is appropriate for the due administration of Ontario commodity futures law.

Application without notice

(3)The court may make an order under subsection (1) on an application without notice, but the period of appointment shall not exceed 15 days.

Motion to continue order

(4)If an order is made without notice under subsection (3), the Commission may make a motion to the court within 15 days after the date of the order to continue the order or for the issuance of such other order as the court considers appropriate.

Powers of receiver, etc.

(5)A receiver, receiver and manager, trustee or liquidator of the property of a person or company appointed under this section shall be the receiver, receiver and manager, trustee or liquidator of all or any part of the property belonging to the person or company or held by the person or company on behalf of, or in trust for, any other person or company, and, if so directed by the court, the receiver, receiver and manager, trustee or liquidator has the authority to wind up or manage the business and affairs of the person or company and has all powers necessary or incidental to that authority.

Directors' powers cease

(6)If an order is made appointing a receiver, receiver and manager, trustee or liquidator of the property of a person or company under this section, the powers of the directors of the company that the receiver, receiver and manager, trustee or liquidator is authorized to exercise may not be exercised by the directors until the receiver, receiver and manager, trustee or liquidator is discharged by the court.

Fees and expenses

(7)The fees charged and expenses incurred by a receiver, receiver and manager, trustee or liquidator appointed under this section in relation to the exercise of powers pursuant to the appointment shall be in the discretion of the court.

Variation or discharge of order

(8)An order made under this section may be varied or discharged by the court on motion.

Limitation period

60.4Except where otherwise provided in this Act, no proceeding under this Act shall be commenced later than six years from the date of the occurrence of the last event on which the proceeding is based.

42.(1)Subsection 63 (1) of the Act is amended by striking out ``this Act or the regulations require" in the first and second lines and substituting ``Ontario commodity futures law requires".

(2)Subsection 63 (2) of the Act is amended by striking out ``this Act" in the third line and substituting ``Ontario commodity futures law".

43.(1)Subsection 64 (1) of the Act is amended by striking out ``this Act or a regulation" in the eighth line and substituting ``Ontario commodity futures law".

(2)Subsection 64 (2) of the Act is amended by striking out ``this Act, the regulations or any direction, decision, order, ruling or other requirement made or given under this Act or the regulations" in the last four lines and substituting ``Ontario commodity futures law".

44.Section 65 of the Act, as amended by the Statutes of Ontario, 1997, chapter 19, section 1, is repealed.

45.Section 66 of the Act is repealed.

46.Section 67 of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 1, is repealed.

47.The Act is amended by adding the following Part:

Part XV

Rules, Regulations and Policies

Rules

65.(1)The Commission may make rules in respect of the following matters:

1.Prescribing requirements in respect of applications for registration and the renewal, amendment, expiration or surrender of registration and in respect of suspension, cancellation or reinstatement of registration.

2.Prescribing categories or sub-categories of registrants, classifying registrants into categories or sub-categories and prescribing the conditions of registration or other requirements for registrants or any category or sub-category, including,

i.standards of practice and business conduct of registrants in dealing with their customers and clients and prospective customers and clients,

ii.requirements that are advisable for the prevention or regulation of conflicts of interest, and

iii.requirements in respect of membership in a self-regulatory organization.

3.Extending any requirements prescribed under paragraph 2 to unregistered directors, partners, salespersons and officers of registrants.

4.Prescribing requirements in respect of the residence in Ontario or Canada of registrants.

5.Prescribing requirements in respect of notification by a registrant or other person or company in respect of a proposed change in beneficial ownership of, or control or direction over, securities of the registrant and authorizing the Commission to make an order that a proposed change may not be effected before a decision by the Commission as to whether it will exercise its powers under paragraph 1 of subsection 60 (1) as a result of the proposed change.

6.Prescribing requirements for persons and companies in respect of calling at or telephoning to residences for the purpose of trading in any contract.

7.Prescribing requirements in respect of the disclosure or furnishing of information to the public or the Commission by market participants, or providing for exemptions from or varying the requirements under this Act in respect of the disclosure or furnishing of information to the public or the Commission by market participants.

8.Providing for exemptions from the registration requirements under this Act or for the removal of exemptions from those requirements.

9.Providing for exemptions from requirements applicable to dealers or advisers, or for the removal of exemptions from those requirements.

10.Providing for exemptions from or varying the requirements set out in Part XII.

11.Prescribing requirements in respect of the books, records and other documents required by Ontario commodity futures law to be kept by market participants, including the form in which and the period for which the books, records and other documents are to be kept.

12.Regulating recognized commodity futures exchanges, recognized self-regulatory organizations and recognized clearing houses, including prescribing requirements in respect of the review or approval by the Commission of any by-law, rule, regulation, policy, procedure, interpretation or practice.

13.Prescribing requirements in respect of market participants, including requirements in respect of membership in a self-regulatory organization and participation by registered dealers and registered advisers in a compensation fund.

14.Providing for exemptions from the requirement that a contract be traded on a commodity futures exchange that has been registered or recognized by the Commission under this Act or the removal of exemptions from those requirements.

15.Providing exemptions from the requirement that a commodity futures contract provide for physical delivery of the underlying interest or be traded on a commodity futures exchange.

16.Prescribing requirements in respect of the acceptance of the form of contracts, including designating any goods, article, service, right, interest, security, financial instrument, currency, interest rate, foreign exchange rate, economic indicator, index, basket, agreement or other benchmark of any kind, and the relationship between any of the foregoing, as a commodity.

17.Regulating the trading of contracts, including requiring reporting of trades and quotations.

18.Regulating trading or advising in contracts to prevent trading or advising that is fraudulent, manipulative, deceptive or unfairly detrimental to investors.

19.Designating activities, including the use of documents or advertising, in which market participants are permitted to engage or are prohibited from engaging in connection with the trading of contracts.

20.Prescribing which trading is trading outside Ontario.

21.Prescribing requirements relating to the qualification of a registrant to act as an adviser to a mutual fund, non-redeemable investment fund, commodity pool or managed futures account.

22.Prescribing requirements in respect of financial accounting, reporting and auditing for purposes of this Act, the regulations and the rules, including,

i.defining accounting principles and auditing standards acceptable to the Commission,

ii.financial reporting requirements for the preparation and dissemination of future-oriented financial information and pro forma financial statements,

iii.standards of independence and other qualifications for auditors,

iv.requirements respecting a change in auditors by a registered dealer or registered adviser, and

v.requirements respecting a change in the financial year of a market participant.

23.Requiring or respecting the media, format, preparation, form, content, execution, certification, dissemination and other use, filing and review of all documents required under or governed by this Act, the regulations or the rules and all documents determined by the regulations or the rules to be ancillary to any such documents, including,

i.applications for registration and other purposes,

ii.risk disclosure statements, and

iii.interim financial statements and financial statements.

24.Varying the form and content of any of the documents referred to in paragraph 23, including substituting a form of document and its contents for any form of document and its contents prescribed by this Act.

25.Prescribing the fees payable to the Commission, including those for filing, for applications for registration or exemptions, for trades in contracts, in respect of audits made by the Commission and in connection with the administration of Ontario commodity futures law.

26.Respecting the designation or recognition of any person, company, market or jurisdiction if advisable for purposes of any provision of Ontario commodity futures law, including,

i.registering or recognizing commodity futures exchanges, self-regulatory organizations and clearing houses,

ii.exempting commodity futures exchanges from the need to be registered or recognized, and

iii.designating a person or company for the purpose of the definition of market participant.

27.Respecting the practice and procedure for the segregation of customers' money, securities, property, proceeds and funds, including the form and content of any agreement respecting assets in segregation.

28.Respecting the conduct of the Commission and its employees in relation to duties and responsibilities and discretionary powers under this Act, including,

i.the conduct of investigations and examinations carried out under Part IV (Investigations), and

ii.the conduct of hearings.

29.Varying the application of this Act to permit or require the use of an electronic or computer-based system for the filing, delivery or deposit of,

i.documents or information required under or governed by Ontario commodity futures law, and

ii.documents determined by the regulations or rules to be ancillary to documents required under or governed by Ontario commodity futures law.

30.Establishing requirements for and procedures in respect of the use of an electronic or computer-based system for the filing, delivery or deposit of documents or information.

31.Prescribing the circumstances in which persons or companies shall be deemed to have signed or certified documents on an electronic or computer-based system for any purpose of this Act.

32.Varying this Act to permit or require methods of filing or delivery, to or by the Commission, market participants or others of documents, information, notices, books, records, things, reports, orders, authorizations or other communications required under or governed by Ontario commodity futures law.

33.Respecting any other matter authorized by or required to implement any provision of this Act.

Regulations

(2)The Lieutenant Governor in Council may make regulations in respect of,

(a)any matter in respect of which the Commission may make rules, with necessary modifications;

(b)any matter advisable for carrying out the purposes of this Act.

Revoking regulations

(3)Subject to the approval of the Minister, the Commission, concurrently with making a rule, may make a regulation that amends or revokes any provision of a regulation made by the Lieutenant Governor in Council under this Act or by the Commission under this subsection that, in the opinion of the Commission, is necessary or advisable to effectively implement the rule.

Effective date

(4)A regulation made under subsection (3) is not effective before the rule referred to in that subsection comes in force.

Retroactive

(5)Subject to subsection (4), a regulation made under subsection (3), if it so provides, is effective with reference to a period before it was filed.

Incorporation by reference

(6)A regulation or rule authorized by this section may incorporate by reference, in whole or in part, any standard, procedure or guideline and may require compliance with any standard, procedure or guideline adopted.

Classes

(7)Regulations or rules in respect of registrants, other persons or companies, contracts, trades or other matters or things may be made in respect of any class or category of registrants, other persons or companies, contracts, trades or other matters or things.

Scope

(8)A regulation or rule may be general or particular in its application, may be limited as to time or place, or both, and may exclude any place from the application of the regulation or rule.

Exemptions

(9)A regulation or rule may authorize the Commission or the Director to grant an exemption to it.

Same

(10)An exemption or a removal of an exemption,

(a)may be granted or made, in whole or in part; and

(b)may be granted or made subject to conditions or restrictions.

Existing regulations become rules

(11)The Lieutenant Governor in Council may, by order, determine at any time that any regulation, or part thereof, in force at that time shall thereafter be a rule.

Regulations Act does not apply

(12)The Regulations Act does not apply to the rules.

Same

(13)A regulation made under subsection (3) is subject to the Regulations Act.

L.G. in C. prevails

(14)If there is a conflict or an inconsistency between a regulation made by the Lieutenant Governor in Council under this Act and a rule, the regulation prevails, but in all other respects a rule has the same force and effect as a regulation.

Deemed rules

66.(1)Every order and ruling of the Commission that is listed in the Schedule shall be deemed to be a rule validly made under this Act and to have come into force on the day this section comes into force.

Amended orders or rulings

(2)For the purposes of subsection (1), a reference to an order, ruling or policy, whether or not it is referred to in the Schedule, as amended, is a reference to the order, ruling or policy as it exists on the day this section comes into force.

Publication

67.(1)The Commission shall publish in its Bulletin notice of every rule that it proposes to make under section 65.

Notice

(2)The notice must include the following:

1.The proposed rule.

2.A statement of the substance and purpose of the proposed rule.

3.A summary of the proposed rule.

4.A reference to the authority under which the rule is proposed.

5.A discussion of all alternatives to the proposed rule that were considered by the Commission and the reasons for not proposing the adoption of the alternatives considered.

6.A reference to any significant unpublished study, report or other written materials on which the Commission relies in proposing the rule.

7.A description of the anticipated costs and benefits of the proposed rule.

8.A reference to every regulation or provision in a regulation to be amended or revoked under section 65.

Exception

(3)The Commission does not have to make reference to written material that, in the opinion of the Commission, should be held in confidence because it discloses intimate financial, personal or other information and the desirability of avoiding disclosure of the substance of it or its existence in the interests of any person or company affected outweighs the desirability of making it or knowledge of its existence available to the public.

Representations

(4)Upon publication of a notice under subsection (1), the Commission shall invite, and shall give a reasonable opportunity to, interested persons and companies to make written representations with respect to the proposed rule within a period of at least 90 days after the publication.

Exceptions to notice requirement

(5)Publication of a notice is not required if,

(a)all persons and companies who would be subject to the proposed rule are named, the information set out in subsection (2) is sent to each of them and they and any other person or company whose interests are likely to be substantially affected by the proposed rule are given an opportunity to make written representations with respect to it;

(b)the proposed rule grants an exemption or removes a restriction and is not likely to have a substantial effect on the interests of persons or companies other than those who benefit under it;

(c)what is proposed is only an amendment that does not materially change an existing rule;

(d)the Commission,

(i)believes that there is an urgent need for the proposed rule and that, without it, there is a substantial risk of material harm to investors or to the integrity of the capital markets, and

(ii)has the approval of the Minister to make the rule without publication of notice; or

(e)the proposed rule remakes an order, ruling or policy that was deemed to be a rule by the operation of section 66 without materially changing the effect or intent of the rule.

Publication

(6)When a rule to which clause (5) (d) applies comes into force, the Commission shall publish in its Bulletin a statement setting out the substance and purpose of the rule and the nature of the urgency and the risk.

Changes to proposal

(7)If, following publication of the notice and consideration of the submissions, the Commission proposes material changes to the proposed rule, the Commission shall publish in its Bulletin notice of the proposed changes.

Notice

(8)The notice must include the following:

1.The proposed rule with the changes incorporated.

2.A concise statement of the purpose of the changes.

3.The reasons for the changes.

Representations re changes

(9)Upon publication of a notice of changes, the Commission shall invite, and shall give a reasonable opportunity to, interested persons and companies to make written representations with respect to the changes within such period as the Commission considers appropriate.

Making rule

(10)In cases where a notice and comment process is required, the Commission may make the rule only at the end of the notice and comment process and after considering all representations made as a result of that process.

Inspection of material

(11)Section 63 applies to all written representations made under this section as if they were material required to be filed.

Definition

(12)In this section and in section 68,

``rule" includes an amendment to and a revocation of a rule.

Delivery of rules to Minister

68.(1)The Commission must deliver to the Minister a copy of every rule made by it together with the following:

1.A copy of the notices published under section 67, unless publication of notice was not required and copies of all documents referred to in the notices.

2.A summary of the representations made and other documents submitted in respect of the rule as proposed.

3.All other material information that was considered by the Commission in connection with the making of the rule.

Publication

(2)The Commission shall publish in its Bulletin every rule made by it as soon after the rule is made as practicable together with the following:

1.The date on which a rule and the material required under subsection (1) were delivered to the Minister.

2.The date the rule is to come into force if an action is not taken by the Minister under subsection (3).

3.A statement of the substance and purpose of the rule.

4.A summary of the written comments received during the comment periods if notice and comment were required.

5.A statement of the Commission setting out its response to the significant issues and concerns brought to the attention of the Commission during the comment periods.

Action by Minister

(3)Within 60 days after a rule is delivered to the Minister, the Minister may,

(a)approve the rule,

(b)reject the rule; or

(c)return it to the Commission for further consideration.

When rules effective

69.(1)A rule that is approved by the Minister comes into force 15 days after it is approved unless there is a later day specified in the rule in which case it comes into force on that later day.

Same

(2)If the Minister does not approve a rule, reject it or return it to the Commission for further consideration and a coming into force day,

(a)that is at least 75 days after the rule is delivered to the Minister is specified in the rule, the rule comes into force on the specified day;

(b)is not specified in the rule, the rule comes into force on the 75th day after the rule is delivered to the Minister; or

(c)that is within 75 days after the rule is delivered to the Minister is specified in the rule, the rule comes into force on the 75th day after the rule is delivered to the Minister.

Same

(3)A rule that is returned to the Commission for further consideration cannot come into force until it is returned by the Commission to the Minister at which time this section applies as if the rule were delivered for the first time.

Same

(4)A rule that is rejected by the Minister does not come into force.

Same

(5)A rule to which clause 67 (5) (d) (urgency provision) applies that is approved by the Minister comes into force on the day it is published in the Commission's Bulletin.

Revocation by operation of law

(6)Every rule to which clause 67 (5) (d) applies is revoked on the 275th day after it comes into force.

Publication

(7)The Commission shall publish every rule that comes into force in The Ontario Gazette and in its Bulletin.

Deemed notice

(8)Every person or company affected by a rule shall be deemed to have notice of it when it is published in the Commission's Bulletin.

Returned for consideration

70.(1)If the Minister returns a rule to the Commission for further consideration, the Minister may specify what is to be considered, the conditions that apply and the process to be followed.

Same

(2)Subject to any instruction that the Commission receives under subsection (1), the Commission shall consider any rule returned to it in the manner and following the process that it feels is appropriate.

Publication

71.The Commission shall publish in its Bulletin notice of,

(a)any action taken by the Minister under subsection 68 (3) in respect of every rule that the Commission has delivered to the Minister; and

(b)any matters specified by the Minister under subsection 70 (1) to be considered.

Studies

72.(1)The Minister may in writing require the Commission,

(a)to study and make recommendations in respect of any matter of a general nature under or affecting Ontario commodity futures law; and

(b)to consider making a rule in respect of a matter specified by the Minister.

Publication

(2)The Commission shall publish in its Bulletin notice of every requirement from the Minister made under subsection (1).

Notice

(3)The notice must include the following:

1.A statement of the substance of the requirement.

2.A reference to every unpublished study, report or other written materials provided to the Commission by the Minister other than materials that the Minister has asked the Commission to treat as confidential.

Definition, ``policy"

73.(1)In this Act,

``policy" means a written statement of the Commission of,

(a)principles, standards, criteria or factors that relate to a decision or exercise of a discretion by the Commission or the Director under this Act, the regulations or the rules,

(b)the manner in which a provision of this Act, the regulations or the rules is interpreted or applied by the Commission or the Director,

(c)the practices generally followed by the Commission or the Director in the performance of duties and responsibilities under this Act or regulations, and

(d)something that is not legislative in nature.

Publication

(2)The Commission shall publish in its Bulletin notice of the proposed adoption of a policy.

Notice

(3)The notice must include the following:

1.The proposed policy.

2.A statement of the purpose of the proposed policy.

3.A summary of the proposed policy.

4.A reference to any significant unpublished study, report, decision or other written materials on which the Commission relies in proposing the policy.

5.A reference to any provision of this Act, a regulation or a rule to which the proposed policy relates.

Exception

(4)The Commission does not have to make reference to written material that, in the opinion of the Commission, should be held in confidence because it discloses intimate financial, personal or other information and the desirability of avoiding disclosure of the substance of it or its existence in the interests of any person or company affected outweighs the desirability of making it or knowledge of its existence available to the public.

Representations

(5)Upon publication of the notice, the Commission shall invite, and shall give a reasonable opportunity to, interested persons and companies to make written representations with respect to the proposed policy within a period of at least 60 days after the publication.

Exceptions to notice requirement

(6)Publication of a notice is not required if the proposed policy would make no material substantive change to an existing policy.

Changes to proposal

(7)If, following publication of the notice, the Commission proposes material changes to the proposed policy, the Commission shall publish in its Bulletin,

(a)the proposed policy with the changes incorporated;

(b)a concise statement of the purpose for the changes; and

(c)the reasons for the changes.

Representations re changes

(8)Upon publication of a notice of change, the Commission shall invite, and shall give a reasonable opportunity to, interested persons and companies to make written representations with respect to the change within such period as the Commission considers appropriate.

Publication in Bulletin

(9)The Commission shall publish in its Bulletin every policy adopted by it as soon after the policy is adopted as practicable together with the following:

1.The date the policy comes into effect.

2.A statement of the substance and purpose of the policy.

3.A summary of the written comments received during the period for comments.

4.A statement of the Commission setting out its response to the significant issues and concerns brought to the attention of the Commission during the comment periods and the reasons for any changes made to the proposed policy following its publication.

Inspection of material

(10)Section 62 applies to all written representations made under this section as if they were material required to be filed.

Restriction

(11)The Commission shall not adopt a policy that, by reason of its prohibitive or mandatory character, is of a legislative nature.

Definition

(12)In this section,

``policy" includes a change to and a rescission of a policy.

Memorandum of understanding

74.(1)The Commission must first deliver to the Minister and then publish in the Commission's Bulletin every agreement, memorandum of understanding or arrangement between the Commission and,

(a)any agency of the Government of Ontario or any agency of any other government that exercises regulatory authority under statute over transactions in contracts or markets therefor, commodities transactions or markets therefor, or financial institutions;

(b)any self-regulatory organization or clearing house; or

(c)any jurisdiction.

Minister's option

(2)The Minister may approve or reject the agreement, memorandum of understanding or arrangement within 60 days after it is published in the Bulletin.

Coming into effect

(3)If the Minister approves the agreement, memorandum of understanding or arrangement, it comes into effect on the day it is approved.

Same

(4)If the Minister does not approve or reject the agreement, memorandum of understanding or arrangement, it comes into effect on the 60th day after its publication in the Bulletin.

Same

(5)If the Minister rejects the agreement, memorandum of understanding or arrangement before it comes into effect by the operation of subsection (4), it does not come into effect.

General orders prohibited

75.The Commission shall not make any order or rulings of general application.

Review by Committee

76.(1)Within five years after this section comes into force and within each five-year period after that, the Minister shall appoint an advisory committee to review the legislation, regulations and rules relating to matters dealt with by the Commission and the legislative needs of the Commission.

Same

(2)The committee shall review the legislation, regulations and rules relating to matters dealt with by the Commission and the legislative needs of the Commission and solicit the view of the public in respect of those matters by means of a notice and comment process.

Report

(3)The committee shall prepare for the Minister a report of its review and its recommendations.

Same

(4)The Minister shall table the report in the Legislature.

Committee Review

(5)Upon the report being tabled, a select or standing committee of the Legislative Assembly shall be appointed to review the report, hear the opinions of interested persons or companies and make recommendations to the Legislative Assembly regarding amendments to this Act.

Confidential information

77.The Minister is entitled to keep confidential any information or documents received from the Commission that the Commission was entitled to keep confidential.

Revocation or variation of decision

78.(1)The Commission may, on the application of the Executive Director or a person or company affected by the decision, make an order revoking or varying a decision of the Commission if, in the Commission's opinion, the order would not be prejudicial to the public interest.

Terms and conditions

(2)The order may be made on such terms and conditions as the Commission may impose.

No privilege

79.(1)Despite subsection 33 (4) of the Evidence Act, the Commission may, by order, compel a bank or officer of a bank, in an investigation, financial examination or hearing under Ontario commodity futures law to which the bank is not a party, to produce any book or record the contents of which can be proved under section 33 of the Evidence Act or to appear as a witness to prove the matters, transactions and accounts contained in the book or record.

Definitions

(2)In subsection (1),

``bank" and ``officer of a bank" have the same meanings as in subsection 33 (4) of the Evidence Act.

Exemption

80.Except where exemption applications are otherwise provided for in Ontario commodity futures law, the Commission may, on the application of an interested person or company and if, in the Commission's opinion, it would not be prejudicial to the public interest, make an order on such terms and conditions as it may impose exempting the person or company from any requirement of Ontario commodity futures law.

Costs

81.Nothing shall preclude a court from ordering costs payable to the Commission and in the event that costs are awarded to the Commission, a counsel fee may be awarded despite the fact that the Commission was represented by Commission staff.

Decision under more than one provision

82.Nothing in this Act shall be construed as limiting the Commission's ability to make a decision under more than one provision of Ontario commodity futures law in respect of the same conduct or matter.

Enforcement of Commission decision

83.(1)On filing with the Superior Court of Justice, a decision made by the Commission or by a Director pursuant to subsection 3.1 (1) shall be deemed to be an order of the Superior Court of Justice and is enforceable as an order of that court.

Filing decision

(2)A decision of a Director may not be filed with the court under subsection (1) until the time permitted for an application to review the Director's decision pursuant to subsection 4 (2) has expired or, if the decision has been appealed, the Commission has confirmed it.

Application for letters of request

84.(1)The Commission may apply to the Superior Court of Justice for an order,

(a)appointing a person to take the evidence of a witness outside of Ontario for use in a proceeding before the Commission; and

(b)providing for the issuance of a letter of request directed to the judicial authorities of the jurisdiction in which the witness is to be found, requesting the issuance of such process as is necessary to compel the person to attend before the person appointed under clause (a) to give testimony on oath or otherwise and to produce documents and things relevant to the subject-matter of the proceeding.

Practice and procedure

(2)The practice and procedure in connection with an appointment under this section, the taking of evidence and the certifying and return of the appointment shall, as far as possible, be the same as those that govern similar matters in civil proceedings in the Superior Court of Justice.

Admissibility of evidence

(3)The making of an order under subsection (1) does not determine whether evidence obtained pursuant to the order is admissible in the proceeding before the Commission.

Reciprocal assistance

(4)If it is made to appear to the Superior Court of Justice that a court or tribunal of competent jurisdiction outside of Ontario has, on behalf of a securities commission, a commodity futures commission or other body empowered by statute to administer or regulate trading in contracts, duly authorized, by commission, order or other process, the obtaining of the testimony of a witness outside the jurisdiction of the securities commission, commodity futures commission or other body, the Superior Court of Justice may order the examination of the witness before the person appointed in the manner and form directed by the commission, order or other process, and may, by the same or by subsequent order, command the attendance of the witness for the purpose of being examined, or the production of a writing or other document or thing mentioned in the order, and may give all such directions as to the time and place of the examination and all other matters connected with the examination as seem proper.

Exchange of information

85.Despite the Freedom of Information and Protection of Privacy Act, the Commission may provide information to and receive information from other securities or financial regulatory authorities, stock exchanges, self-regulatory bodies or organizations, law enforcement agencies and other governmental or regulatory authorities, both in Canada and elsewhere, and any information so received by the Commission shall be exempt from disclosure under that Act if the Commission determines that such information should be maintained in confidence.

48.The Act is amended by adding the following Schedule:

Schedule

(Definition of ``rule" in subsection 1 (1))

In The Matter Of The Members Of The Toronto Stock Exchange And Of The Investment Dealers Association of Canada (Order)

(exempts members of the TSE and IDA from the need to segregate)

November 29, 1979

In The Matter Of The Members Of The Toronto Stock Exchange And Of The Investment Dealers Association of Canada

(ordonnance)

(Dispense les membres de la B.T. et de l'ACCOVAM de l'obligation de garder les fonds part.)

29 novembre 1979

In The Matter Of Trading In Commodity Futures Contracts And Commodity Futures Options Entered Into On Commodity Futures Exchanges Situate Outside Canada Other Than Commodity Futures Exchanges In The United States of America (Order)

(exempts trades by registered futures commission merchants in contracts on offshore exchanges from requirements of s. 33 of Act)

January 3, 1980

(Dispense des exigences de l'art. 33 de la Loi les oprations sur contrats que les ngociants-commissionnaires en contrats terme inscrits effectuent sur des bourses trangres.)

3 janvier 1980

In The Matter Of Trading Commodity Futures Contracts Entered Into On The Montreal Stock Exchange (Order)

(exempts trades by registered futures merchants in contracts on ME from requirements of s. 33 of Act)

August 25, 1980

In The Matter Of Trading Commodity Futures Contracts Entered Into On The Montreal Stock Exchange (ordonnance)

(Dispense des exigences de l'art. 33 de la Loi les oprations sur contrats que les ngociants-commissionnaires en contrats terme inscrits effectuent sur la B.M.)

25 aot 1980

In The Matter Of The Toronto Futures Exchange (Order)

(exempts registrants from the need to provide customers with the terms and conditions of contracts)

January 10, 1984

In The Matter Of The Toronto Futures Exchange (ordonnance)

(Dispense les personnes ou compagnies inscrites de l'obligation de fournir les conditions des contrats leurs clients.)

10 janvier 1984

In The Matter Of The Toronto Futures Exchange (Order)

(exempts TFE members from the need to segregate)

January 10, 1984

In The Matter Of The Toronto Futures Exchange (ordonnance)

(Dispense les membres de la B.C.T.T. de l'obligation de garder les fonds part.)

10 janvier 1984

In The Matter Of The Toronto Futures Exchange (Ruling)

(exempts trades made on the floor of the TFE by floor traders from s. 22)

January 10, 1984

In The Matter Of The Toronto Futures Exchange (dcision)

(Soustrait l'art. 22 les oprations que les ngociateurs en Bourse effectuent sur le parquet de la B.C.T.T.)

10 janvier 1984

(exempts trades by registered futures commission merchants in contracts subject to rules of London Metal Exchange from s. 33 of Act)

January 26, 1984

(Soustrait l'art. 33 de la Loi les oprations sur contrats assujetties aux rgles

de la Bourse appele London Metal Exchange qu'effectuent les ngociants-commissionnaires en contrats terme inscrits.)

26 janvier 1984

In The Matter Of Trading In Commodity Futures Contracts And Commodity Futures Options Entered Into On Commodity Futures Exchanges In The United States Of America (Order)

(exempts trades by registered dealers in contracts on contract markets designated by CFTC)

October 26, 1984

In The Matter Of Trading In Commodity Futures Contracts And Commodity Futures Options Entered Into On Commodity Futures Exchanges In The United States Of America (ordonnance)

(Prvoit une dispense l'gard des oprations sur contrats que les courtiers inscrits effectuent sur des marchs de contrats dsigns par la C.F.T.C.)

26 octobre 1984

In The Matter Of The Toronto Stock Exchange (Ruling)

(exempts traders on floor of TSE from s. 22 of Act)

April 9, 1985

In The Matter Of The Toronto Stock Exchange (dcision)

(Soustrait les ngociateurs en Bourse de la B.T. l'art. 22 de la Loi.)

9 avril 1985

In The Matter Of The Toronto Stock Exchange (Ruling)

(exempts trades in Government of Canada Bond Options from s. 22 of the CFA if made by Securities Act registrants)

September 16, 1985

In The Matter Of The Toronto Stock Exchange (dcision)

(Soustrait l'art. 22 de la Loi sur les contrats terme sur marchandises les oprations sur options sur obligations du gouvernement du Canada qu'effectuent les personnes ou compagnies inscrites aux termes de la Loi sur les valeurs mobilires.)

16 septembre 1985

In The Matter Of The Toronto Stock Exchange (Order and Ruling)

(exempts trades in contracts made on the floor of the TFE by options attorneys and competitive options traders from s. 22)

May 15, 1987

In The Matter Of The Toronto Stock Exchange (ordonnance et dcision)

(Soustrait l'art. 22 les oprations sur contrats qu'effectuent les dlgus en bourse sur options et les ngociateurs d'options indpendants sur le parquet de la B.C.T.T.)

15 mai 1987

In The Matter Of The Toronto Futures Exchange (Order and Ruling)

May 15, 1987

In The Matter Of The Toronto Futures Exchange (ordonnance et dcision)

15 mai 1987

In The Matter Of Trading In Commodity Futures Contracts And Commodity Futures Options Entered Into On The Montreal Exchange (Order)

August 22, 1989

In The Matter Of Trading In Commodity Futures Contracts And Commodity Futures Options Entered Into On The Montreal Exchange (ordonnance)

22 aot 1989

In The Matter Of Certain Members Of The Toronto Futures Exchange (Order) (limits the exemption from the need to segregate)

January 8, 1990

In The Matter Of Certain Members Of The Toronto Futures Exchange (ordonnance)

(Restreint la dispense de l'obligation de garder les fonds part.)

8 janvier 1990

In The Matter Of The Toronto Stock Exchange (Ruling)

(exempts options attorneys and competitive options traders from s. 22 if they trade TSE 300 contracts)

January 15, 1994

In The Matter Of The Toronto Stock Exchange (dcision)

(Soustrait l'art. 22 les dlgus en bourse sur options et les ngociateurs d'options indpendants qui effectuent des oprations sur contrats sur l'indice des 300 de la B.T.)

15 janvier 1994

Commencement

49.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 34 comes into force on a day to be named by proclamation of the Lieutenant Governor.

Part V

Community Small Business Investment Funds Act

50.Subsection 1 (1) of the Community Small Business Investment Funds Act, as amended by the Statutes of Ontario, 1994, chapter 17, section 76, 1997, chapter 43, Schedule C, section 2 and 1998, chapter 34, section 12, is further amended by adding the following definition:

``qualifying corporation" means a corporation that is not,

(a)an investment corporation, or

(b)a qualifying financial institution or a specified corporation or insurance corporation related to the qualifying financial institution for the purposes of section 66.1 of the Corporations Tax Act. (``corporation admissible")

51.Clause 6 (1) (g) of the Act is repealed.

52.Clauses (a) and (b) of the definition of ``qualifying debt obligation" in subsection 12 (1) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 17, section 82, are repealed and the following substituted:

(a)if secured, is secured solely by a floating charge on the assets of the entity or by a guarantee given by an investment corporation.

53.Subclause 14 (1) (d) (i) of the Act is repealed and the following substituted:

(i)assisting the development of eligible businesses, creating, maintaining and protecting jobs by providing financial and managerial advice to eligible businesses and by making eligible investments, and

. . . . .

54.(1)Subsection 17 (1) of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 5, is repealed and the following substituted:

Required investment levels

(1)On December 31 of each year, a labour sponsored investment fund corporation shall hold eligible investments that have an aggregate cost of not less than the amount determined using the formula,

A - B - C + D - E - F

in which,

``A"is 70 per cent of the aggregate amount of equity capital received by the corporation on the issue of Class A shares that are outstanding at the end of the applicable calendar year and that were issued before the sixty-first day of that year, but excluding Class A shares that have been outstanding,

(a)for at least five years, in the case of shares issued before May 7, 1996, and

(b)for at least eight years, in the case of shares issued after May 6, 1996;

``B"is 20 per cent of the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were issued during the period beginning on the sixty-first day of the year preceding the applicable calendar year and ending on the sixtieth day of the applicable year and that are outstanding at the end of that year;

``C"is the aggregate amount of losses of the corporation that are realized on its eligible investments before the end of the applicable calendar year;

``D"is the lesser of the aggregate amount of gains of the corporation realized on its eligible investments before the end of the applicable calendar year and the amount of the variable ``C"\;

``E"is the total of all amounts that are permitted by subsections 24.1 (3) and (4) to be applied against the investment requirement imposed by this subsection; and

``F"is the amount determined under subsection (2).

(2)Subsections 17 (1.1), (1.2) and (1.3) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 5, are repealed.

(3)Subsection 17 (2) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 13, is repealed and the following substituted:

Same

(2)The amount of the variable ``F" in subsection (1) is calculated using the formula,

G + ( H x I / J )

in which,

``G"is the aggregate amount of tax paid by the corporation under subsection 28 (3) that has not been refunded before the end of the applicable calendar year;

``H"is the aggregate amount of tax and penalties that the corporation has paid under Part X.3 of the Income Tax Act (Canada) that have not been refunded before the end of the applicable calendar year;

``I"is the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were issued to shareholders who were ordinarily resident in Ontario when the shares were issued and that were outstanding when the taxes or penalties were paid under Part X.3 of the Income Tax Act (Canada); and

``J"is the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were outstanding when the taxes or penalties were paid under Part X.3 of the Income Tax Act (Canada).

(4)Subsection 17 (3) of the Act is repealed and the following substituted:

Disposal of investment

(3)For the purposes of this section, a labour sponsored investment fund corporation that disposes of an eligible investment shall be deemed to continue to hold the investment for nine months after the date of disposition.

55.(1)The English version of clause 18 (1) (c) of the Act is amended by adding ``and" at the end.

(2)Subclauses 18 (1) (d) (iv), (vi), (vii) and (viii) of the Act are repealed.

(3)The English version of subclause 18 (1) (d) (xi) of the Act is amended by striking out ``and" at the end.

(4)Clause 18 (1) (e) of the Act is repealed.

(5)Subsection 18 (8) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 17, section 85 and amended by 1996, chapter 29, section 11, is further amended by striking out ``section 17, clause 18 (1) (e), section 18.1, clause 20 (2) (b)" in the amendment of 1996 and substituting ``sections 17 and 18.1, paragraphs 2 and 3 of subsection 20 (2)".

(6)Subsection 18 (10) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 17, section 85, is amended by striking out ``subclause (1) (d) (iii), (iv), (viii) or (x)" and substituting ``subclause (1) (d) (iii) or (x)".

(7)Subsection 18 (11) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 17, section 85, is repealed and the following substituted:

Relending, etc., to holding company

(11)Despite subclause (1) (d) (i), in the case of an investment in an eligible business as set out in clause (f) of the definition of ``eligible business" in subsection 12 (1), the investment may be used by the eligible business for the purpose of relending to the eligible business or to a related corporation or partnership, but only if the investment is not used or intended to be used by the recipient corporation or partnership in a manner that is contrary to a purpose described in clause (1) (d).

56.Section 18.1 of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 6 and amended by 1996, chapter 29, section 12, 1997, chapter 43, Schedule C, section 9 and 1998, chapter 34, section 14, is repealed and the following substituted:

Definitions

18.1(1)In this section,

``listed company" means, in relation to a labour sponsored investment fund corporation, a business described in subsection (6) with respect to which subsection (7) does not apply; (``socit cote")

``reporting issuer" means a reporting issuer within the meaning of the Securities Act\; (``metteur assujetti")

``small business" means a business that meets the requirements set out in subsection (11). (``petite entreprise")

Limit on investment in reporting issuers

(2)During each calendar year, a labour sponsored investment fund corporation shall not hold eligible investments in reporting issuers in an amount greater than the amount determined using the formula,

A + [ 15% x ( B - A ) ]

in which,

``A"is the sum of,

(a)the cost to the corporation of every investment made before May 7, 1996 in a reporting issuer, if the investment is an eligible investment for the purposes of section 17, and

(b)35.7 per cent of that portion of the corporation's equity capital that was received before May 7, 1996 on the issue of Class A shares that have been outstanding for less than five years and that was not invested in an eligible business before May 7, 1996; and

``B"is the amount of equity capital received by the corporation before January 1, 2000 that it is required by section 17 to have invested in eligible investments at the end of the previous calendar year.

Same, at year end

(3)At the end of each calendar year, a labour sponsored investment fund corporation shall not hold eligible investments in reporting issuers in an amount greater than the amount determined using the formula,

A + [ 15% x ( C - A ) ]

in which,

``A"has the same meaning as in subsection (2); and

``C"is the amount of equity capital received by the corporation before January 1, 2000 that it is required by section 17 to

Status of reporting issuer

(4)For the purposes of subsections (2) and (3), an eligible business that was a reporting issuer when the labour sponsored investment fund corporation made the eligible investment in it shall be deemed to be a reporting issuer.

Limit on investment in listed companies

(5)During each calendar year, a labour sponsored investment fund corporation shall not hold investments in eligible businesses that are listed companies to the extent that the cost of the investments exceeds 15 per cent of that portion of the corporation's equity capital received after 1999 that the corporation is required by section 17 to hold in eligible investments at the end of the calendar year.

Status of listed company

(6)For the purposes of subsection (5), a business (the ``business") is a listed company, in relation to a labour sponsored investment fund corporation (the ``investing corporation"),

(a)if any of the shares of the business are or were listed on a stock exchange prescribed by Regulation 3200 or 3201 made under the Income Tax Act (Canada); and

(b)if,

(i)the business is a reporting issuer when the investing corporation first makes an eligible investment in the business, or

(ii)the amount, if any, invested by the investing corporation in the business before the business becomes a reporting issuer is less than 10 per cent (or such other dollar amount as may be prescribed) of the total investments made by the investing corporation in the business.

Same

(7)Despite subsection (6), a corporation that is a listed company shall be deemed not to be a listed company until 12 months after its shares are first listed on a stock exchange prescribed by Regulation 3200 or 3201 made under the Income Tax Act (Canada).

Required investment in small businesses

(8)At the end of each calendar year, a labour sponsored investment fund corporation shall hold eligible investments in small businesses, and the eligible investments must have an aggregate cost of not less than the amount determined using the formula,

D - E - F - G + H - I

in which,

``D"is 70 per cent of the sum of,

(a)10 per cent of the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were issued after May 6, 1996 and before March 2, 1997, that are outstanding at the end of the applicable calendar year and that have been outstanding for less than eight years,

(b)15 per cent of the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were issued after March 1, 1997 and before March 2, 1999, that are outstanding at the end of the applicable calendar year and that have been outstanding for less than eight years, and

(c)20 per cent of the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were issued after March 1, 1999, that are outstanding at the end of the applicable calendar year and that have been outstanding for less than eight years;

``E"is 4 per cent of the equity capital received by the corporation on the issue of Class A shares that were issued during the period beginning on the sixty-first day of the preceding calendar year and ending on the sixtieth day of the applicable calendar year and that are outstanding at the end of the applicable calendar year;

``F"is the greater of,

(a)20 per cent of the realised investment losses relating to all eligible investments made after May 6, 1996, net of realised gains relating to all eligible investments made after that date, or

(b)the amount of the realised investment losses relating to eligible investments made after May 6, 1996, net of realised gains relating to eligible investments made after that date in small businesses;

``G"is the total of all amounts permitted by subsections 24.1 (3) and (4) to be deducted from the investment requirement imposed by this subsection;

``H"is the amount required by subsection 24.1 (3.1) to be invested in small businesses;

``I"is the amount determined under subsection (9).

Same

(9)The variable ``I" in subsection (8) is 20 per cent of the amount calculated using the formula,

J + ( K x L / M )

in which,

``J"is the aggregate amount of tax that the corporation has paid under subsection 28 (3) and that has not been refunded before the end of the applicable calendar year;

``K"is the aggregate amount of tax and penalties that the corporation has paid under Part X.3 of the Income Tax Act (Canada) and that have not been refunded before the end of the applicable calendar year;

``L"is the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were issued to shareholders who were ordinarily resident in Ontario when the shares were issued and that were outstanding when the taxes or penalties were paid under Part X.3 of the Income Tax Act (Canada); and

``M"is the aggregate amount of equity capital received by the corporation on the issue of Class A shares that were outstanding when the taxes or penalties were paid under Part X.3 of the Income Tax Act (Canada).

Disposal of investment in small business

(10)For the purposes of subsection (8), a labour sponsored investment fund corporation that disposes of an investment in a small business shall be deemed to continue to hold the investment for nine months after the date of disposition.

Status of small business

(11)For the purposes of subsections (8) and (10), a business is a small business if it meets the following requirements when the labour sponsored investment fund corporation invests in it:

1.It is an eligible business.

2.The total gross assets (as determined in the prescribed manner) of the business and of each corporation and partnership related to it do not exceed $5 million.

3.The total number of employees (as determined in the prescribed manner) of the business and of each corporation and partnership related to it does not exceed 50.

Same, number of employees

(12)For the purposes of paragraph 3 of subsection (11), an employee who normally works at least 20 hours per week shall be counted as one employee and an employee who normally works less than 20 hours per week shall be counted as half an employee.

Restriction re certain corporations

(13)If a labour sponsored investment fund corporation is registered under Part X.3 of the Income Tax Act (Canada), this section applies only with respect to,

(a)equity capital received by the corporation on the issue of Class A shares to persons ordinarily resident in Ontario when the shares were issued; and

(b)amounts paid as a return of capital for Class A shares issued to persons ordinarily resident in Ontario when the shares were issued.

57.(1)The definition of ``eligible business" in subsection 18.2 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10, is repealed and the following substituted:

``eligible business" means a taxable Canadian corporation or Canadian partnership that meets the criteria described in subsection (1.1) at the times specified in that subsection. (``entreprise admissible")

(2)Clauses (a) and (b) of the definition of ``qualifying debt obligation" in subsection 18.2 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10, are repealed and the following substituted:

(a)if secured, is secured solely by a floating charge on the assets of the entity or by a guarantee given by an investment corporation.

(3)The definition of ``within the community" in subsection 18.2 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10, is amended,

(a)by striking out the portion before clause (a) and substituting the following:

``within the community" means, with respect to a community small business investment fund corporation or a community sponsor,

. . . . .

(b)by striking out ``or" at the end of clause (d), by adding ``or" at the end of clause (e) and by adding the following clause:

(f)if a municipality and a university, college or research institute affiliated with a university or hospital are co-sponsors of a community small business investment fund corporation,

(i)within the geographic limits of the municipality that is a co-sponsor,

(ii)within a facility of the institutional co-sponsor, or

(iii)within a place of business in Ontario where intellectual property developed by the institutional co-sponsor or by its faculty, staff or graduates is used in eligible business activities.

(4)Section 18.2 of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10 and amended by 1998, chapter 34, section 15, is further amended by adding the following subsection:

Eligible business

(1.1)A taxable Canadian corporation or Canadian partnership must meet the following criteria in order to be an eligible business in relation to a community small business investment fund corporation:

1.When the community small business investment fund corporation makes an investment in the corporation or partnership, the sum of the following amounts must exceed 1.5:

i.The percentage (expressed as a decimal fraction) that the wages and salaries paid by the corporation or partnership to employees employed in respect of its eligible business activities carried on within the community is of the total wages and salaries paid by it.

ii.The percentage (expressed as a decimal fraction) that the value of the gross assets of the corporation or partnership that are used in its eligible business activities carried on within the community is of the value of its total gross assets.

2.When the community small business investment fund corporation makes its initial investment in the corporation or partnership, the value of the total gross assets of the corporation or partnership, together with the total gross assets of all related corporations and partnerships, must not exceed $1 million or such other amount as may be prescribed. For the purposes of this paragraph, the value of the total gross assets must be calculated in the prescribed manner.

(5)Subsection 18.2 (2) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10 and amended by 1998, chapter 34, section 15, is repealed and the following substituted:

Investment period

(2)The investment period for investing in a corporation registered under this Part ends on the first anniversary of the date of registration of the corporation.

(6)Subsection 18.2 (3) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 15, is repealed.

58.(1)Clause 18.4 (1) (d.2) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 16, is repealed and the following substituted:

(d.2)the articles of the corporation specify that each eligible investor must invest at least $25,000 in Class A shares of the corporation.

(2)Subclause 18.4 (1) (f) (i) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10, is repealed and the following substituted:

. . . . .

59.Subsection 18.5 (1) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 17, is repealed and the following substituted:

Entitlement to registration

(1)A community sponsor is entitled to registration of a corporation by the Minister if all of the following requirements are met:

1.The community sponsor applies for registration under this Part and files the required documents before January 1, 2002.

2.The other requirements of this Part are satisfied.

3.The corporation has received offers from eligible investors to subscribe for its shares for an aggregate amount of not less than $2 million.

4.The corporation has received offers from eligible investors described in clauses (a) and (b) of the definition of ``eligible investor" in subsection 18.2 (1) to subscribe for its shares for an aggregate amount greater than 25 per cent of the proposed capitalization of the corporation (as specified in the investment plan referred to in subsection 18.3 (2)).

60.(1)Clause 18.8 (1) (a) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 18, is repealed and the following substituted:

(a)the investment is made in a business that is an eligible business when the investment is made.

(2)Subsection 18.8 (2) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 10 and amended by 1998, chapter 34, section 18, is further amended by striking out ``subsections 20 (5) and (6)" in the amendment of 1998 and substituting ``subsection 20 (5)".

61.(1)Subsection 20 (2) of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 12, is repealed and the following substituted:

Labour sponsored investment fund corporation

(2)In any of the following circumstances, a labour sponsored investment fund corporation (the ``corporation") shall not invest or maintain an investment in a business that is or was at any time an eligible business for the purposes of Part III:

1.If the corporation controls the business.

2.If the corporation makes all of its investments in the business before January 1, 2000 and makes an investment in the business from equity capital received by the corporation on the issue of its Class A shares, and if the aggregate of all investments made with that equity capital by the corporation in the business exceeds $15 million.

3.If the corporation makes any investment in the business after December 31, 1999 and makes an investment in the business from equity capital received by the corporation on the issue of its Class A shares, and if the aggregate of all investments made with that equity capital by the corporation in the business exceeds the lesser of,

i.10 per cent of the aggregate equity capital received by the corporation on the issue of its Class A shares that were outstanding when the corporation made its most recent investment in the business, and

ii.$15 million.

(2)Subsection 20 (3) of the Act is amended by striking out ``Clause (2) (a)" at the beginning and substituting ``Paragraph 1 of subsection (2)".

(3)Subsections 20 (5) and (6) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 12, are repealed and the following substituted:

Investment restriction

(5)A community small business investment fund corporation shall not invest more than 20 per cent of the equity capital it receives on the issue of its Class A shares in a business that is an eligible business for the purposes of Part III.1.

62.(1)Subsection 24.1 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 14, is amended by striking out ``January 1, 1999" and substituting ``January 1, 2001".

(2)Subsections 24.1 (2) and (3) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 20, are repealed and the following substituted:

Investment deadlines

(2)The following deadlines apply for investing funds set aside under subsection (1):

1.Funds set aside before May 5, 1998 must be invested in a community small business investment fund corporation not later than December 31, 1998.

2.Funds set aside after May 4, 1998 and before January 1, 1999 must be invested in a community small business investment fund corporation not later than December 31, 1999.

3.Funds set aside after December 31, 1998 and before January 1, 2000 must be invested in a community small business investment fund corporation not later than December 31, 2000.

4.Funds set aside after December 31, 1999 and before January 1, 2001 must be invested in a community small business investment fund corporation not later than December 31, 2001.

Investment tax credit

(3)Upon application, the Minister may allow a labour sponsored investment fund corporation to do one of the following things if the corporation sets aside funds for investment in a community small business investment fund corporation, or if the corporation invests in such a corporation before the applicable investment deadline described in subsection (2):

1.The corporation may treat twice the amount set aside or invested as an amount invested in an eligible business that is a small business, for the purpose of determining whether the corporation meets the small business investment requirements of section 18.1; and it may treat the amount set aside or invested as an amount invested in an eligible investment for the purpose of determining whether the corporation meets the requirements of subsection 17 (1).

2.The corporation may reduce the amount of tax owing under subsection 28 (3) for the calendar year in which the funds are set aside or invested. The amount of the tax reduction is twice the amount set aside or invested.

Cancellation of credit

(3.1)The following rules apply if a labour sponsored investment fund corporation that sets aside funds does not meet the applicable investment deadline set out in subsection (2):

1.On the following date, paragraph 1 of subsection (3) ceases to apply with respect to the funds that are not invested in a community small business investment fund corporation:

i.December 31, 1998, if the investment deadline for the funds set aside is December 31, 1998.

ii.December 31, 1999, if the investment deadline for the funds set aside is December 31, 1999.

iii.December 31, 2000, if the investment deadline for the funds set aside is December 31, 2000.

iv.December 31, 2001, if the investment deadline for the funds set aside is December 31, 2001.

The labour sponsored investment fund corporation is then required to invest the funds, together with any interest earned on them, in eligible investments that are small businesses and to maintain the investments as required by section 18.1.

2.Once the applicable investment deadline has passed, paragraph 2 of subsection (3) shall be deemed never to have applied with respect to the funds set aside by the labour sponsored investment fund corporation.

(3)Subsection 24.1 (4) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 14 and amended by 1998, chapter 34, section 20, is further amended by,

(a)striking out ``subsections 17 (1) and (2)" in the amendment of 1998 and substituting ``subsection 17 (1)"\; and

(b)striking out ``subsection 18.1 (3)" in the eleventh line and substituting ``section 18.1".

(4)Subsection 24.1 (5) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 14, is repealed and the following substituted:

Definition

(5)In this section,

``small business" has the same meaning as in subsection 18.1 (1).

63.(1)Subsection 25 (4.1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 15 and amended by 1998, chapter 34, section 21, is further amended by striking out ``on or before December 31, 1999" and substituting ``before January 1, 2002".

(2)Subsections 25 (4.3) and (4.4) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 21, are repealed and the following substituted:

Investment incentive

(4.3)A qualifying individual or qualifying corporation may apply for an investment incentive if the individual or corporation is the beneficial and registered owner of Class A shares of a community small business investment fund corporation purchased directly from the corporation before January 1, 2002.

Additional incentive

(4.4)A qualifying individual or qualifying corporation may apply for an additional investment incentive if the individual or corporation holds Class A shares of a community small business investment fund corporation that makes one or more eligible investments under this Part.

(3)Subsection 25 (4.7) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 21, is amended by inserting ``or qualifying corporation" after ``qualifying individual" in the fourth line.

(4)Paragraph 3 of subsection 25 (4.7) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 21, is repealed and the following substituted:

3.That the incentive relates to shares purchased by the individual or corporation directly from the corporation issuing the shares.

(5)Subsection 25 (4.8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 21, is amended by inserting ``or qualifying corporation" after ``qualifying individual" in the third and fourth lines.

(6)Clause 25 (4.9) (b) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 21, is repealed and the following substituted:

(b)7.5 per cent of the amount paid by the qualifying individual or qualifying corporation before January 1, 2002 to the community small business investment fund corporation on the issue of Class A shares.

(7)Clause 25 (4.10) (b) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 21, is amended by adding at the end ``or qualifying corporation".

64.(1)Subsections 25.1 (1) and (2) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 8, are repealed and the following substituted:

Certificate of compliance

(1)On or before January 31, each labour sponsored investment fund corporation shall give the Minister a certificate setting out the status of the corporation's compliance with the investment requirements of this Act during the previous calendar year.

Same

(1.1)The certificate must be in a form approved by the Minister.

Proof of compliance

(2)At the request of the Minister, a labour sponsored investment fund corporation shall give the Minister information and documents sufficient to allow the Minister to determine whether the corporation is complying with this Act.

Same

(2.1)The information referred to in subsection (2) must be given to the Minister in a form approved by the Minister.

(2)Clause 25.1 (3) (a) of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 29, section 13, is repealed and the following substituted:

(a)the corporation shall be considered not to be in compliance with sections 17 and 18.1 as of the following date:

1.In the case of a failure to give the Minister the certificate required by subsection (1), January 1 of the year in which the certificate should have been given to him or her.

2.In the case of a failure to give information or documents required by subsection (2) to the Minister, the date on which the information or documents should have been given to him or her.

(3)Subsection 25.1 (5) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 8 and amended by 1997, chapter 43, Schedule C, section 23, is repealed and the following substituted:

Penalty

(5)A corporation shall pay to the Minister a penalty equal to twice the amount of all investment corporation tax credits for which it issues tax credit certificates in respect of Class A shares issued at a time when the corporation is not in compliance with section 17 or 18.1 or is considered under clause (3) (a) not to be in compliance with either of those sections.

(4)Subsection 25.1 (5.1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 22, is amended by striking out ``paragraph 2 of subsection 24.1 (2)" at the end and substituting ``paragraph 2 of subsection 24.1 (3)".

(5)Subsection 25.1 (6) of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 29, section 13 and amended by 1997, chapter 43, Schedule C, section 23, is repealed.

65.Subsection 26 (3) of the Act is amended by striking out ``and" at the end of clause (a) and by adding the following clause:

(a.1)the corporation pays an amount equal to the amount, if any, that would be owing under subsection 28 (3) calculated as if the year has ended immediately before the corporation's registration is surrendered; and

. . . . .

66.(1)Subsection 27 (2) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 17, is amended by striking out the portion before clause (a) and substituting the following:

Repayment of tax credits

(2)A labour sponsored investment fund corporation whose registration is revoked by the Minister shall immediately pay to the Minister an amount of money equal to the lesser of,

. . . . .

(2)Section 27 of the Act, as amended by the Statutes of Ontario, 1994, chapter 17, section 90 and 1997, chapter 43, Schedule C, section 17, is further amended by adding the following subsection:

Same

(2.1)A labour sponsored investment corporation that makes a request under section 26 to surrender its registration under this Act or that proposes to wind up or dissolve shall immediately pay to the Minister an amount of money equal to the total of all amounts, each of which is the amount in respect of a Class A share of the capital stock of the particular corporation outstanding immediately before the particular time that is determined using the formula,

A x B

in which,

``A"is,

(a)if the original acquisition of the share was before May 7, 1996 and less than five years before the particular time, 4 per cent of the consideration received by the particular corporation for the issue of the share,

(b)if the original acquisition of the share was after May 6, 1996 and less than eight years before the particular time, 1.875 per cent of the consideration received by the particular corporation for the issue of the share, and

(c)in any other case, nil; and

``B"is,

(a)if the original acquisition of the share was before May 6, 1996, the number obtained when the number of whole years throughout which the share was outstanding before the particular time is subtracted from five, and

(b)in any other case, the number obtained when the number of whole years throughout which the share was outstanding is subtracted from eight.

(3)Subsection 27 (8) of the Act, as amended by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 23, is further amended by striking out ``subsection 127.4 (3)" and substituting ``section 127.4".

67.The Act is amended by adding the following sections:

Notice of amalgamation or merger, etc.

27.1(1)A labour sponsored investment fund corporation that has issued Class A shares shall notify the Minister in writing if it proposes an amalgamation or merger.

Same

(2)The notice must be given at least 30 days before the proposed amalgamation or merger and it must be accompanied by such information and documents as the Minister may request.

Effect of amalgamation or merger

(3)The following rules apply if at least one of the corporations that is amalgamating or merging is a labour sponsored investment fund corporation immediately before the amalgamation or merger:

1.For the purposes of this Act, the new corporation shall be deemed to be the same corporation as, and a continuation of, each predecessor corporation.

2.The new corporation shall be deemed to have been registered under Part III on the earliest date on which any of the predecessor corporations was registered under this Act.

3.For the purposes of this Act, the new corporation shall be deemed to have issued all Class A shares issued by a predecessor corporation for the amount of equity capital received by the predecessor corporation on the issue of those shares.

4.If a predecessor corporation was authorized to issue a class of shares to which subclause 14 (1) (c) (iii) applies, the new corporation shall be deemed to have received the Minister's approval to issue substantially similar shares at the time of the amalgamation or merger.

5.Each of the new shares issued by the new corporation upon the amalgamation or merger in replacement of shares that were issued by a predecessor corporation shall be deemed to have been issued at the time that the predecessor corporation issued the replaced shares.

Effect of certain types of non-compliance

(4)The rules set out in subsection (5) apply,

(a)if, immediately after the amalgamation or merger, the articles of the new corporation do not meet the requirements of clause 14 (1) (c), (d) or (f) or subsection 14.1 (1);

(b)if the new corporation does not comply with subsection 13 (1);

(c)if, immediately before the amalgamation or merger, the registration of a predecessor corporation under this Act was revoked; or

(d)if the new corporation distributed any property other than its Class A shares to shareholders in exchange for Class A shares of a predecessor corporation.

Same

(5)Subject to subsection (6), the following rules apply in any of the circumstances described in subsection (4):

1.The new corporation shall be deemed to have surrendered its registration under this Act immediately after the amalgamation or merger.

2.The new corporation shall promptly pay to the Minister the amount of money that each predecessor corporation would have been required to pay under subsection 27 (2.1) if it had surrendered its registration under this Act immediately before the amalgamation or merger.

Exception

(6)The Minister may exempt a new corporation from all or part of subsection (5) upon such conditions as he or she considers appropriate.

Definitions

(7)In this section,

``new corporation" means the corporation that results from the amalgamation or merger of a predecessor corporation and one or more other corporations; (``nouvelle corporation")

``predecessor corporation" means a corporation that is amalgamated or merged and that is or was a labour sponsored investment fund corporation. (``corporation remplace")

Notice of dissolution, etc.

27.2(1)A labour sponsored investment fund corporation that has issued Class A shares shall notify the Minister in writing if it proposes to dissolve or wind up.

Same

(2)The notice must be given at least 30 days before the proposed dissolution or wind-up and it must be accompanied by such information and documents as the Minister may request.

68.(1)Subsection 28 (1) of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 29, section 14, is amended by striking out the portion before the formula and substituting the following:

Investment level tax, employee ownership labour sponsored venture capital corporation

(1)An employee ownership labour sponsored venture capital corporation that does not meet or maintain the level of eligible investments required by section 9 to be held by the corporation at the end of a particular fiscal year shall immediately pay to the Minister a tax for the year equal to the amount determined using the formula,

. . . . .

(2)Subsection 28 (3) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 29, section 14, is amended by striking out the portion before clause (a) and substituting the following:

Investment level tax, labour sponsored investment fund coporation

(3)A labour sponsored investment fund corporation that does not meet or maintain the level of eligible investments required by section 17 to be held by the corporation at the end of a particular calendar year or that does not comply with the investment restrictions and meet the requirements for eligible investments specified by section 18.1 shall pay to the Minister a tax for the year equal to the amount by which the greater of,

. . . . .

(3)Subclause 28 (3) (b) (i) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 29, section 14, is repealed and the following substituted:

(i)15 per cent of the amount by which ``A" exceeds ``B" where,

``A"is the amount of the equity capital received by the corporation on the issue of Class A shares after May 6, 1996 and before January 1, 2000 that is invested at the end of the calendar year in eligible businesses that were reporting issuers when the investment was made, and

``B"is 15 per cent of the amount of that equity capital that the corporation is required by section 17 to hold in eligible investments at the end of the calendar year,

(i.1)15 per cent of the amount by which ``C" exceeds ``D" where,

``C"is the amount invested by the corporation at the end of the calendar year in eligible businesses that are listed companies, and

``D"is the limit on investments in listed companies that is imposed by subsection 18.1 (5), and

. . . . .

(4)Section 28 of the Act, as amended by the Statutes of Ontario, 1996, chapter 29, section 14 and 1998, chapter 34, section 23, is further amended by adding the following subsection:

Same

(3.1)The corporation shall pay the tax required by subsection (3) no later than the day on which it is required to give the Minister the certificate required by subsection 25.1 (1) or the information required by subsection 25.1 (2), whichever applies.

(5)Clause 28 (4) (b) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 23, is repealed and the following substituted:

(b)the Minister is satisfied that the corporation is maintaining the level of eligible investments required by section 17 and is complying with the investment restrictions and meeting the requirements for eligible investments specified by section 18.1.

(6)Section 28 of the Act, as amended by the Statutes of Ontario, 1996, chapter 29, section 14 and 1998, chapter 34, section 23, is further amended by adding the following subsection:

Definitions

(5)In this section,

``listed company", ``reporting issuer" and ``small business" have the same meaning as in subsection 18.1 (1).

69.(1)Subsection 28.1 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule C, section 18 and amended by 1998, chapter 34, section 24, is further amended by striking out the portion before the formula and substituting the following:

Investment level tax, shareholder in community small business investment corporation

(1)Subject to subsection (1.1), a shareholder in a community small business investment fund corporation that does not meet the level of eligible investments required by section 18.7 to be held by the corporation at the end of a particular year shall immediately pay to the Minister a tax for the year equal to the amount determined using the formula,

. . . . .

(2)Clause (c) of the definition of ``P" in subsection 28.1 (1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 24, is repealed and the following substituted:

(3)Subsection 28.1 (1.1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 24, is amended by,

(a)inserting ``or qualifying corporation" after ``qualifying individual"\; and

(b)striking out ``$37,000" and substituting ``$37,500".

70.Clause 31 (1) (c) of the Act is repealed.

Commencement

71.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 51 shall be deemed to have come into force on November 27, 1998.

Part VI

Corporations Tax Act

72.The definition of "Minister" in subsection 1 (1) of the Corporations Tax Act, as amended by the Statutes of Ontario, 1994, chapter 14, section 1, is repealed and the following substituted: "

Minister" means, unless otherwise provided in this Act, the Minister of Finance, but the reference to "Minister" in subsection 249.1 (7) of the Income Tax Act (Canada) means the Minister of National Revenue for the purposes of this Act. (``ministre")

73.(1)Subsection 5.2 (1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 27, is amended by striking out "Subject to subsections (2) and (3)" at the beginning and substituting "Except as otherwise provided in this section".

(2)Section 5.2 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 27, is amended by adding the following subsection:

Exception

(1.1)Subsection (1) does not apply if the corporation deducted or claimed the amount, or failed to deduct or claim the amount, primarily for purposes other than a reduction in the total amount of income tax payable to one or more provinces over the course of one or more taxation years.

(3)Section 5.2 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 27, is amended by adding the following subsections:

Amalgamation and winding-up

(5)For the purposes of this section,

(a)a corporation that is formed as a result of an amalgamation or merger of two or more corporations shall be deemed to be the same corporation as, and a continuation of, each of the corporations that amalgamated or merged; and

(b)a corporation that is a parent for the purposes of subsection 88 (1) of the Income Tax Act (Canada), or would be a parent if it were a taxable Canadian corporation, shall be deemed to be the same corporation as, and a continuation of, each corporation that, if it were a taxable Canadian corporation, would be described as a subsidiary in that subsection, after the winding-up of the subsidiary.

Same

(6)Subsection (5) applies in respect of amalgamations, mergers and windings-up of corporations during a taxation year that begins on or after the day that subsection comes into force.

74.The Act is amended by adding the following section:

Definition

5.3(1)In this section,

``specified reserve" means, in relation to a corporation, an amount claimed as a deduction in determining income under Part II under any of the following provisions of the Income Tax Act (Canada) as they apply for the purposes of Part II, or under the comparable provisions of the laws of a province that impose a tax calculated by reference to the corporation's income:

1.Paragraphs 20 (1) (l), (l.1), (m), (m.1), (n) and (o).

2.Subsection 26 (2).

3.Subsection 32 (1).

4.Clauses 40 (1) (a) (iii) (C) and (D).

5.Subparagraphs 138 (3) (a) (i), (ii) and (iv).

6.Such other provisions as may be prescribed by regulation.

Anti-avoidance, provincial tax

(2)The amount of a specified reserve claimed by a corporation in determining its income under Part II for a taxation year shall be deemed to be the amount determined under subsection (4) if the conditions set out in subsection (3) are satisfied.

When applicable

(3)Subsection (2) applies to a corporation for a taxation year if the following conditions are satisfied:

1.The amount of the specified reserve claimed by the corporation is greater than the amount of the specified reserve that it claims for the purposes of determining its income under the laws of another province that impose a similar tax calculated by reference to the corporation's income or for the purposes of determining the amount of its income under the Income Tax Act (Canada), or the corporation does not claim any amount in respect of the specified reserve in determining its income for the purposes of the income tax laws of another province or under the Income Tax Act (Canada).

2.The corporation's Ontario allocation factor, as defined in subsection 12 (1), for a subsequent taxation year is at least 20 per cent less than its Ontario allocation factor for the taxation year, or would be at least 20 per cent less if the corporation had tax payable under Part II for the taxation year and subsequent taxation years.

3.It is reasonable to consider that the primary reason that the corporation is claiming different amounts of the specified reserve is to reduce the amount of income taxes payable to one or more provinces over the course of one or more taxation years.

4.The total amount of income tax payable by the corporation under this Act and under the income tax laws of other provinces for the period that includes the taxation year and subsequent taxation years would be less if subsection (2) did not apply.

Amount deemed to be claimed

(4)If subsection (2) applies to a corporation for a taxation year in respect of a specified reserve claimed by the corporation, the amount the corporation is deemed to have claimed for the taxation year is the lesser of,

(a)the least of the amounts claimed by the corporation as the specified reserve for the same taxation year in determining the amount of its income for the purposes of the income tax laws of another province or under the Income Tax Act (Canada); or

(b)nil, if no specified reserve is claimed by the corporation for the taxation year in determining the amount of its income for the purposes of the income tax laws of another province or under the Income Tax Act (Canada).

Partnerships

(5)If a corporation is a member of a partnership during a taxation year, subsections (1), (2), (3) and (4) apply with necessary modifications in determining the corporation's share of the income or loss of the partnership for a fiscal period ending in the taxation year.

Amalgamation and winding-up

(6)For the purposes of this section,

Application

(7)This section applies with respect to a corporation's taxation years that end on or after the day this section comes into force.

75.(1)Subsection 11 (4) of the Act is amended by striking out ``subsection (2)" in the third line and substituting ``subsection (7)".

(2)Subsection 11 (4) of the Act, as amended by subsection (1), applies to taxation years that begin after February 23, 1998.

(3)Subparagraph 2 ii of subsection 11 (5.1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 28, is repealed and the following substituted:

ii.that are for the use, or for the right to use in Canada, of computer software or a patent or information concerning industrial, commercial or scientific experience, or a design or model, plan, secret formula or process.

(4)Paragraph 2 of subsection 11 (5.1) of the Act, as amended by subsection (3), applies to amounts that became payable by a corporation after May 4, 1999 and are deducted in computing its income for a taxation year ending after May 4, 1999.

(5)Paragraph 1 of subsection 11 (15) of the Act is amended by striking out "paragraph 149 (1) (d)" in the second line and substituting "paragraphs 149 (1) (d) to (d.6)".

(6)Paragraph 1 of subsection 11 (15) of the Act, as amended by subsection (5), applies to taxation years commencing after December 31, 1998.

76.(1)Clause (a) of the definition of "Ontario allocation factor" in subsection 12 (1) of the Act, as amended by the Statutes of Ontario, 1998, chapter 5, section 7 and 1998, chapter 34, section 29, is further amended by striking out "any of sections 13, 13.1, 13.2 and 13.3" in the amendment of 1998, chapter 34, section 29 and substituting ``any of sections 13, 13.1, 13.2, 13.3 and 13.4".

(2)Clause (b) of the definition of "Ontario allocation factor" in subsection 12 (1) of the Act, as amended by the Statutes of Ontario, 1998, chapter 5, section 7 and 1998, chapter 34, section 29, is further amended by striking out "any of sections 13, 13.1, 13.2 and 13.3" in the amendment of 1998, chapter 34, section 29 and substituting ``any of sections 13, 13.1, 13.2, 13.3 and 13.4".

77.Subsection 13.2 (1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 30, is amended by striking out ``other than a child care operator" in the first and second lines and substituting ``other than a child care operator that controls or manages a child care facility with an expectation of profit".

78.The Act is amended by adding the following section:

Ontario school bus safety tax incentive

13.4(1)In computing its income from a business for a taxation year, a corporation may deduct an Ontario school bus safety tax incentive for the taxation year equal to the total of all amounts determined using the formula,

( A / B ) x 0.3

in which, "

A"is the capital cost of an eligible school bus acquired by the corporation in the taxation year, and "

B"is the corporation's Ontario allocation factor for the taxation year.

Eligible school bus

(2)A vehicle acquired by a corporation is an eligible school bus if,

(a)it is a school bus as defined under subsection 175 (1) of the Highway Traffic Act that meets the requirements of sections 1 and 3 of Regulation 612 of the Revised Regulations of Ontario, 1990 (School Buses) made under the Highway Traffic Act and that conforms to the Canadian Standards Association Standard D250-1998;

(b)it is acquired by the corporation after May 4,1999 and before May 5, 2002;

(c)it is used in Ontario to transport children or to transport adults with a developmental disability and has not previously been used; and

(d)the capital cost of the vehicle is included by the corporation for the purposes of the Income Tax Act (Canada) in class 10 of Schedule II to the regulations made under that Act.

Corporate partner

(3)If a corporation is a member of a partnership at the end of a taxation year and the partnership incurs, in a fiscal period of the partnership that ends in the taxation year, a capital cost in respect of the acquisition of an eligible school bus that would qualify for the Ontario school bus safety tax incentive if the expenditure had been made by a corporation, the portion of the capital cost that may reasonably be considered to be the corporation's share of the capital cost may be included by the corporation in determining the amount of its Ontario school bus safety tax incentive for the taxation year.

Limited partner

(4)Despite subsection (3), no amount may be included by a corporation in the amount of its Ontario school bus safety tax incentive for a taxation year in respect of an expenditure incurred by a partnership in which the corporation is a limited partner.

Recapture

(5)Subsection (6) applies if, within 36 months after the day a corporation or a partnership in which the corporation is a member acquires a school bus that is an eligible school bus in a taxation year, the corporation or partnership disposes of the bus or begins to primarily use the bus for a purpose other than transporting children in Ontario or transporting adults with a developmental disability in Ontario.

Same, calculation

(6)When calculating its income for the taxation year, the corporation shall include the amount determined using the formula,

[ ( A / B) x 0.3 ] x [ ( 1096 - C ) / 1096 ]

in which, "

A"is the capital cost of the eligible school bus, to the extent that the cost was included by the corporation in determining the amount of an Ontario school bus safety tax incentive for a taxation year of the corporation, "

B"is the corporation's Ontario allocation factor for the taxation year, and "

C"is the number of days that the corporation or a partnership in which the corporation is a member owned the eligible school bus before disposing of it or beginning to use it for a purpose other than transporting children in Ontario or transporting adults with a developmental disability in Ontario.

Exception

(7)Subsection (6) does not apply in respect of a disposition of an eligible school bus by a corporation or by a partnership in which the corporation is a partner,

(a)if the corporation or partnership disposes of the bus in connection with a disposition by the corporation or partnership of all or substantially all of the business in which the bus was used, and the person acquiring the business continues after the disposition to carry on the business in Ontario;

(b)if the corporation is in bankruptcy or receivership or is insolvent, and the bus is disposed of in the course of a disposition of the assets of the corporation's business; or

(c)if the corporation disposes of the bus to another corporation (referred to in this clause as the "recipient corporation") as a result of a winding-up of the corporation into the recipient corporation to which subsection 88 (1) of the Income Tax Act (Canada) applies or as a result of an amalgamation or merger of the corporation with another corporation to form the recipient corporation to which subsection 87 (1) of that Act applies.

Interpretation

(8)For the purposes of subsections (5), (6) and (7),

Definition

(9)In this section,

``Ontario allocation factor", of a corporation for a taxation year, means Ontario allocation factor as defined in subsection 12 (1).

79.(1)Subsection 14 (3.2) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 32, is amended by inserting after ``section 5.2" in the fourth line ``or 5.3".

(2)Subclause 14 (5) (e) (i) of the Act, as amended by the Statutes of Ontario, 1998, chapter 5, section 8 and 1998, chapter 34, section 32, is further amended by striking out ``and" at the end of sub-subclause (D) and by adding the following sub-subclause:

(E)under section 13.4 in respect of the corporation's share of the capital costs incurred by the partnership in the fiscal period, and

. . . . .

80.(1)Clause 35 (1) (a) of the Act, as amended by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 16 and 1998, chapter 34, section 37, is further amended by striking out "13.2 and 13.3" in the amendment of 1998 and substituting "13.2, 13.3 and 13.4".

(2)Subsection 35 (2) of the Act, as amended by the Statutes of Ontario, 1998, chapter 5, section 9 and 1998, chapter 34, section 37, is further amended by striking out ``13.2 and 13.3" in the amendment of 1998, chapter 34, section 37 and substituting ``13.2, 13.3 and 13.4".

(3)Subsection 35 (3) of the Act, as amended by the Statutes of Ontario, 1998, chapter 5, section 9 and 1998, chapter 34, section 37, is further amended by striking out ``13.2 or 13.3" wherever it appears and substituting in each case ``13.2, 13.3 or 13.4".

81.(1)Clause 43.3 (3) (b) of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 17, is repealed and the following substituted:

(b)the amount of the corporation's expenditure limit for the taxation year.

(2)Section 43.3 of the Act, as enacted by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 7 and amended by 1996, chapter 24, section 26, 1996, chapter 29, section 48 and 1997, chapter 43, Schedule A, section 17, is further amended by adding the following subsections:

Expenditure limit

(3.1)The amount of a corporation's expenditure limit for a taxation year that ends before May 5, 1999 is the amount that would be determined to be the corporation's expenditure limit for the taxation year for the purposes of subsection 127 (10.1) of the Income Tax Act (Canada).

Same

(3.2)The amount of a corporation's expenditure limit for a taxation year that ends after May 4, 1999 is the amount that would be determined to be its expenditure limit for the taxation year for the purposes of subsection 127 (10.1) of the Income Tax Act (Canada) if, for the purposes of the definition of ``B" in subsection 127 (10.2) of that Act, the business limit of a corporation were considered to be the amount, if any, by which the business limit of the corporation for the taxation year as determined under subsection 41 (3.1) without the application of this subsection exceeds the amount calculated using the formula,

C x D / $ 25 million

in which, "

C"is the amount that would be determined under subsection 41 (3.1) to be the business limit of the corporation for the taxation year without the application of this subsection, and "

D"is,

(a)for a corporation that is not associated with any other corporation in the taxation year, the amount, if any, by which $25 million is less than,

(i)the corporation's taxable paid-up capital for the preceding taxation year as determined under Part III, if the corporation is a corporation that is not a financial institution as defined in subsection 58 (2), a credit union or an insurance corporation,

(ii)the corporation's adjusted taxable paid-up capital for the preceding taxation year as determined under Part III, if the corporation is a financial institution as defined in subsection 58 (2), other than a credit union, or

(iii)the corporation's taxable capital employed in Canada for the preceding taxation year as determined under Part I.3 of the Income Tax Act (Canada), if the corporation is a credit union or an insurance corporation; or

(b)for a corporation that is associated with one or more other corporations in the taxation year, the amount, if any, by which $25 million is less than the total of all amounts, each of which is an amount described in subclause (a) (i), (ii) or (iii) in respect of the corporation for the preceding taxation year or in respect of an associated corporation for its last taxation year ending in the corporation's preceding taxation year.

Transition

(3.3)A corporation's expenditure limit for a taxation year that straddles May 5, 1999 is the sum of the following amounts:

1.The expenditure limit that would be determined under subsection (3.1) for the corporation for the taxation year if the taxation year ended on May 4, 1999, multiplied by the ratio of the number of days in the taxation year before May 5, 1999 to the number of days in the taxation year.

2.The expenditure limit that would be determined under subsection (3.2) for the corporation for the taxation year, multiplied by the ratio of the number of days in the taxation year after May 4, 1999 to the number of days in the taxation year.

Interpretation

(3.4)In the application of subsection 41 (3.1) of this Act and sections 125 and 127 of the Income Tax Act (Canada) for the purposes of subsection (3.2) of this section, a reference to a Canadian-controlled private corporation shall be deemed to be a reference to a qualifying corporation as defined in subsection (4).

Same

(3.5)For the purposes of subsection (3.2),

(a)a corporation that is required to compute its paid-up capital employed in Canada for a taxation year under Division C of Part III shall determine the amount that would be its taxable paid-up capital for the taxation year under Part III as if it were a corporation incorporated in Canada;

(b)a corporation that would be a financial institution as defined in subsection 58 (2) in a taxation year if it carried on business in Canada and had been incorporated in Canada shall determine the amount that would be its adjusted taxable paid-up capital for the taxation year under Part III as if it were a financial institution defined in subsection 58 (2); and

(c)a corporation that is an insurance corporation that was not resident in Canada at any time in a taxation year shall determine the amount that would be its taxable capital employed in Canada under Part I.3 of the Income Tax Act (Canada) as if it were resident in Canada at any time during the year.

(3)Clauses 43.3 (4) (a) and (c) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 7, are repealed and the following substituted:

(a)it has a permanent establishment in Ontario at any time during the taxation year;

. . . . .

(c)it is eligible to claim an investment tax credit for the taxation year under section 127 of the Income Tax Act (Canada) with respect to a qualified expenditure made by the corporation in the taxation year and it files a prescribed form under that section in respect of the investment tax credit.

(4)Subsection 43.3 (4) of the Act, as amended by subsection (3), applies with respect to taxation years ending after May 4, 1999.

82.Section 45 of the Act is repealed and the following substituted:

If corporation bankrupt

45.If a corporation has become bankrupt, the rules provided in section 128 of the Income Tax Act (Canada) apply for the purposes of this Act.

83.(1)Clause 57 (1) (a) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 34, section 47, is amended by inserting "(d.6)" after "(d.5)" in the third line.

(2)Clause 57 (1) (a) of the Act, as amended by subsection (1), applies to taxation years commencing after December 31, 1998.

84.Section 57.4 of the Act, as enacted by the Statutes of Ontario, 1994, chapter 14, section 21 and amended by 1997, chapter 43, Schedule A, section 26, is further amended by adding the following subsections:

Interest

(1.2)In computing its adjusted net income or adjusted net loss for a taxation year under subsection (1) or (2), a corporation may deduct the amount of any interest paid or payable by the corporation that is included in an amount deducted or deductible by the corporation in the taxation year under paragraph 20 (1) (c) or (d) of the Income Tax Act (Canada), as made applicable for the purposes of this Act, to the extent that the amount of interest has not been deducted in computing the corporation's net income or net loss under subsection 57.1 (2).

Same

(1.3)Subsection (1.2) applies with respect to interest incurred after May 4, 1999.

85.(1)Paragraphs 4 and 5 of subsection 62 (1.2) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 48, are repealed and the following substituted:

4.No amount shall be included in determining the amount of a deduction under clause (1) (c) in respect of an investment in a corporation that is a financial institution or that would be a financial institution if it carried on business in Canada and had been incorporated in Canada unless,

i.the investment is in long-term debt of the corporation, as defined in subsection 181 (1) of the Income Tax Act (Canada),

ii.the investment is in shares of the corporation, or

iii.the investment is in a banker's acceptance that was issued for a term of at least 120 days and was held by the corporation for at least 120 days before the end of its taxation year.

5.A loan or advance that was issued for a term of less than 120 days or was held by the corporation for less than 120 days before the end of its taxation year shall not be included in determining the amount of a deduction under clause (1) (c),

i. if the loan or advance is owed by a corporation that does not deal at arm's length with a corporation described in paragraph 4, and

ii.if the corporation described in paragraph 4 guarantees the amount of the loan or advance or provides security, directly or indirectly, for the repayment of the loan or advance.

(2)Subsection 62 (1.2) of the Act, as amended by subsection (1), applies with respect to taxation years ending after the day on which this Act receives Royal Assent.

(3)Section 62 of the Act, as amended by the Statutes of Ontario, 1994, chapter 14, section 26, 1997, chapter 19, section 4, 1997, chapter 43, Schedule A, section 32, 1998, chapter 5, section 19 and 1998, chapter 34, section 48, is further amended by adding the following subsection:

Limitation respecting inclusions and deductions

(11)Subsection 181 (4) of the Income Tax Act (Canada) applies with necessary modifications for the purposes of this Division in determining any amount required to determine a corporation's taxable paid-up capital for a taxation year.

86.(1)The French version of subsection 62.1 (4) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 33, is amended by striking out ``du passif long terme" in the seventh and eighth lines and substituting ``dans une dette du passif long terme".

(2)The French version of subsection 62.1 (5) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 33, is amended by striking out ``du passif long terme" in the fourth and fifth lines and substituting ``dans une dette du passif long terme".

(3)Section 62.1 of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 33 and amended by 1998, chapter 34, section 49, is further amended by adding the following subsections:

Exception

(5.1)Despite subsections (4) and (5), the taxable paid-up capital of a financial institution for a taxation year is the amount, if any, by which its paid-up capital for the year exceeds its investment allowance for the year in respect of all investments, each of which is an investment in a share of the capital stock or long-term debt of a related financial institution that has a permanent establishment in Canada and that is not exempt from tax under this Part, or a related insurance corporation that has a permanent establishment in Canada,

(a)if the financial institution is not controlled, directly or indirectly, at any time in the taxation year, by another financial institution, by an insurance corporation or by a corporation that would be considered to be a financial institution if it carried on business in Canada and had been incorporated in Canada; and

(b)if the financial institution is not deemed by the rules prescribed by the regulations to use any of its taxable paid-up capital in the taxation year in a jurisdiction other than Ontario.

Same

(5.2)If subsection (5.1) applies in determining the taxable paid-up capital of a financial institution for a taxation year, the investment allowance of the financial institution for the taxation year in respect of an investment in a share of the capital stock or long-term debt of a related financial institution or related insurance corporation that has a permanent establishment in Canada is the carrying value of the investment to the financial institution as at the end of the day on which the adjusted taxable paid-up capital of the financial institution is required to be measured under this Part for the taxation year.

87.Clauses 66 (6) (b), (c), (d) and (e) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 35, are repealed and the following substituted:

(b)0.1 per cent of the credit union's taxable paid-up capital employed in Ontario for the taxation year, as determined under this Division, multiplied by the ratio of the number of days in the taxation year that are after December 31, 1998 and before May 5, 1999 to the total number of days in the taxation year.

88.Subsection 66.1 (4.5) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 36, is amended by striking out ``1999" in the third line and substituting ``2002".

89.(1)Section 67 of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 37, is amended by striking out "section 69 or 71" in the fourth line and substituting "section 69".

(2)Section 67 of the Act, as amended by subsection (1), applies to taxation years ending after May 4, 1999.

90.(1)Section 68 of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 38, is repealed and the following substituted:

Small business capital tax exemption

68.(1)Despite sections 66 and 67, no tax is payable under this Part for a taxation year by a corporation that is not a financial institution if,

(a)neither the corporation's total assets at the end of the taxation year nor its gross revenue for the taxation year, as recorded in its books and records, exceeds $1 million; or

(b)the corporation's taxable paid-up capital as determined under Division B of this Part for the taxation year does not exceed $2 million.

Transition

(2)Despite subsection (1), if the taxation year of a corporation that is not a financial institution commences before May 5, 1999, the corporation is liable to tax under this Part equal to the amount, if any, that would otherwise be determined for the taxation year if this section and section 69 read as they did on May 4, 1999, multiplied by the ratio of the number of days in the taxation year before May 5, 1999 to the total number of days in the taxation year.

No exemption

(3)Subsection (1) does not apply to a corporation for a taxation year if the sum of the following amounts exceeds $2 million:

1.The taxable paid-up capital of the corporation for the taxation year.

2.If the corporation is associated with one or more corporations in the taxation year, the total of the taxable paid-up capital of each such associated corporation for the last taxation year of the associated corporation ending during the corporation's taxation year.

3.If the corporation is a member of a partnership or a connected partnership (as determined under subsection 69 (5)) in the taxation year, the aggregate of the shares of the taxable paid-up capital of the partnership or connected partnership that are allocated under subsection 61 (5) to each person related to the corporation, for the last fiscal period of the partnership or connected partnership ending during the corporation's taxation year, if those amounts are not already included within the amounts described in paragraphs 1 and 2.

Non-resident corporations

(4)For the purposes of this section, the taxable paid-up capital of a corporation shall be determined in accordance with the provisions of Division B of this Part, irrespective of whether the corporation is subject to tax under this Act.

(2)Section 68 of the Act, as re-enacted by subsection (1), applies to corporations in respect of taxation years ending after May 4, 1999.

91.(1)The French version of the definition of ``gross revenue" in subsection 69 (1) of the Act is amended by inserting ``ou en commandite" after ``en nom collectif" in the fourth line.

(2)The French version of the definition of ``total assets" in subsection 69 (1) of the Act is amended by inserting ``ou en commandite" after ``en nom collectif" in the fourth line.

(3)Subsection 69 (2) of the Act, as amended by the Statutes of Ontario, 1994, chapter 14, section 30, 1996, chapter 29, section 58 and 1997, chapter 43, Schedule A, section 39, is repealed and the following substituted:

Tax reduction

(2)Despite section 66 and except as provided in subsections (4) and 68 (1) and section 71, the tax payable under this Part for a taxation year by a corporation other than a financial institution is the total of the following amounts:

1.The amount that would have been the corporation's tax payable under this Part for the taxation year if this Part were read as it did on May 4, 1999 multiplied by the ratio of the number of days, if any, in the taxation year that are before May 5, 1999 to the number of days in the taxation year.

2.The amount determined using the formula,

A x ( B - C )

where the variables ``A", ``B" and ``C" represent the amounts described in paragraphs 3, 4 and 5, respectively.

3.For the purposes of paragraph 2, the variable ``A" is the corporation's Ontario allocation factor for the taxation year, as defined in subsection 12 (1).

4.For the purposes of paragraph 2, the variable ``B" is the amount calculated using the formula,

( 0.003 x D ) x E / F

in which,

``D"is the corporation's taxable paid-up capital for the taxation year,

``E"is the number of days in the taxation year that are after May 4, 1999, and

``F"is the number of days in the taxation year.

5.For the purposes of paragraph 2, the variable ``C" is the amount calculated using the formula,

G x D / H

in which,

``G"is the sum of the amounts described in paragraphs 6 to 10,

``D"is the corporation's taxable paid-up capital for the taxation year,

``H"is the sum of the corporation's taxable paid-up capital for the taxation year and the taxable paid-up capital of each corporation, if any, with which it is associated, for the last taxation year of the associated corporation ending during the corporation's taxation year.

6.For the purposes of the variable ``G" in paragraph 5, the first amount is calculated using the formula,

( 0.015 x J ) x K / F

in which,

``F"is the number of days in the taxation year,

``J"is the amount, if any, by which $2.4 million exceeds the amount represented by the variable ``Z", where ``Z" is the aggregate of,

i.the corporation's taxable paid-up capital for the taxation year,

ii.if the corporation is associated with one or more corporations, the taxable paid up capital of each such associated corporation for the last taxation year of the associated corporation ending during the corporation's taxation year,

iii.if the corporation is a member of a partnership or connected partnership (as determined under subsection 69 (5)), the aggregate of the shares of the taxable paid-up capital of the partnership or connected partnership that are allocated under subsection 61 (5) to each person related to the corporation, for the last fiscal period of the partnership or connected partnership ending during the corporation's taxation year, if those amounts are not already included within the amounts described in subparagraphs i and ii, and

``K"is the number of days in the taxation year that are after May 4, 1999 and before January 1, 2000.

7.For the purposes of the variable ``G" in paragraph 5, the second amount is calculated using the formula,

( 0.0075 x L ) x M / F

in which,

``F"is the number of days in the taxation year,

``L"is the amount, if any, by which $2.8 million exceeds ``Z" as defined in paragraph 6, and

``M"is the number of days in the taxation year that are after December 31, 1999 and before January 1, 2001.

8.For the purposes of the variable ``G" in paragraph 5, the third amount is calculated using the formula,

( 0.005 x N ) x P / F

in which,

``F"is the number of days in the taxation year,

``N"is the amount, if any, by which $3.2 million exceeds ``Z" as defined in paragraph 6, and

``P"is the number of days in the taxation year that are after December 31, 2000 and before January 1, 2002.

9.For the purposes of the variable ``G" in paragraph 5, the fourth amount is calculated using the formula,

( 0.00375 x Q ) x R / F

in which,

``F"is the number of days in the taxa-tion year,

``Q"is the amount, if any, by which $3.6 million exceeds ``Z" as defined in paragraph 6, and

``R"is the number of days in the taxa-tion year that are after December 31, 2001 and before January 1, 2003.

10.For the purposes of the variable ``G" in paragraph 5, the fifth amount is calculated using the formula,

( 0.003 x S ) x T / F

in which,

``F"is the number of days in the taxa-tion year,

``S"is the amount, if any, by which $4 million exceeds ``Z" as defined in paragraph 6, and

``T"is the number of days in the taxa-tion year that are after December 31, 2002.

(4)Subsection 69 (4) of the Act is repealed and the following substituted:

No tax reduction

(4)Subsection (2) does not apply to a corporation for a taxation year if the sum of the following amounts exceeds $4 million:

1.The taxable paid-up capital of the corporation for the taxation year.

(5)Subsection 69 (4) of the Act, as re-enacted by subsection (4), applies with respect to taxation years ending after May 4, 1999.

(6)The French version of subsection 69 (5) of the Act is amended by,

(a)inserting ``ou en commandite" after ``en nom collectif" in the second line;

(b)striking out ``membre" in the third line and substituting ``associ"\;

(c)inserting ``ou en commandite" after ``en nom collectif" in the sixth line;

(d)striking out ``premire socit en nom collectif" wherever it appears and substituting ``premire socit" in each case;

(e)striking out ``deuxime socit en nom collectif" wherever it appears and substituting ``deuxime socit" in each case.

92.(1)Subsection 71 (1) of the Act is repealed and the following substituted:

Liability for tax under this Part

(1)Except as provided in subsections (3), 11 (15) and 66 (6), none of the following corporations are required to pay any tax otherwise payable under this Part:

1.A corporation referred to in subsection 57 (1), other than a corporation subject to the rules in subsection 149 (10) of the Income Tax Act (Canada) as made applicable by subsection 57 (7) of this Act.

2.A corporation that is a credit union.

3.A family farm corporation.

4.A family fishing corporation.

(2)Subsection 71 (2) of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 43, Schedule A, section 40, is repealed.

(3)Subsection 71 (3) of the Act is amended by striking out "Subsection (2)" at the beginning and substituting "Subsection (1)".

(4)Section 71 of the Act, as amended by subsections (1) to (3), applies to taxation years of corporations ending after May 4, 1999.

93.Clause 72 (a) of the Act, as amended by the Statutes of Ontario, 1996, chapter 18, section 22, is repealed.

94.(1)Section 73 of the Act is amended by striking out "the provisions of subsections 71 (1) and (2) do not apply" in the third and fourth lines and substituting "subsection 71 (1) does not apply".

(2)Section 73 of the Act, as amended by subsection (1), applies to taxation years ending after May 4, 1999.

95.(1)Subclause 80 (11) (b) (vi) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 55, is repealed and the following substituted:

(vi)section 5.2 or 5.3 applies to the corporation for the taxation year; and

. . . . .

(2)Clause 80 (15) (f) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 55, is repealed and the following substituted:

(f)the deduction or claim referred to in section 5.2 or 5.3.

(3)Section 80 of the Act, as amended by the Statutes of Ontario, 1992, chapter 3, section 16, 1994, chapter 14, section 38, 1996, chapter 1, Schedule B, section 13, 1996, chapter 24, section 30, 1996, chapter 29, section 62, 1997, chapter 19, section 4, 1997, chapter 43, Schedule A, section 46, 1998, chapter 5, section 23 and 1998, chapter 34, section 55, is further amended by adding the following subsection:

Limit on consequential amendments

(29)In assessing or reassessing the amount of a corporation's tax, interest or penalties for a taxation year, or in determining the corporation's losses for a taxation year, neither section 5.2 nor section 5.3 applies in respect of any other taxation year unless the Minister issues a notice of assessment or reassessment for that other taxation year to give effect to the amount deemed to have been deducted or claimed under section 5.2 or 5.3, as the case may be.

96.Subsection 98 (4) of the Act is repealed and the following substituted:

Exception

(4)Despite subsection (1), upon the request of the Minister of Consumer and Commercial Relations, the Minister of Finance may give the following information that has been given to him or her by a corporation to an authorized person employed in the Ministry of Consumer and Commercial Relations or an authorized agent of that Ministry for the purposes of the administration of the Corporations Information Act:

1.The name and mailing address of the corporation.

2.The address of the corporation's registered office or head office, the location of its books and records, and the name, telephone number and fax number of the individual to contact about the books and records.

3.If the corporation is an extra-provincial corporation within the meaning of the Corporations Information Act, the address of its principal place of business in Ontario and any former names of the corporation.

4.The corporation's tax account number with the Ministry of Finance, its business number with the Canada Customs and Revenue Agency and its Ontario Corporation Number with the Ministry of Consumer and Commercial Relations.

5.The taxation year of the corporation.

6.The jurisdiction and date of the incorporation or amalgamation of the corporation.

7.If the corporation was not incorporated in Ontario, the date it commenced business activity in Ontario and, if applicable, the date it ceased business activity in Ontario.

8.The corporation's preferred official language.

9.The name and title of the individual certifying that the information provided to the Minister of Finance is true, correct and complete.

10.Such other non-financial information as may be prescribed by regulation.

11.Any change in the information described in paragraphs 1 to 10 of which the Minister of Finance becomes aware.

Regulations

(5)The Minister may make regulations for the purposes of paragraph 10 of subsection (4) in respect of one or more corporations, and any such regulation is effective with reference to a period before it is filed, if it so provides.

Commencement

97.(1)Subject to subsections (2) and (3), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 96 comes into force on January 1, 2000.

Same

(3)The following provisions shall be deemed to have come into force on the date indicated:

1.On January 1, 1995, section 72.

2.On April 27, 1995, section 82.

3.On May 7, 1997, subsection 86 (3).

4.On February 24, 1998, subsections 75 (1) and (2).

5.On May 6, 1998, section 77.

6.On December 18, 1998, subsections 73 (1) and (2)

7.On December 31, 1998, section 88.

8.On January 1, 1999, subsections 75 (5) and (6) and section 83.

9.On May 5, 1999, subsections 75 (3) and (4), sections 76 and 78, subsection 79 (2) and sections 80, 81, 84, 87 and 89 to 94.

Part VII

Education Act

98.(1)Section 257.11 of the Education Act, as enacted by the Statutes of Ontario, 1997, chapter 31, section 113, is amended by adding the following subsection:

Exception

(1.1)For the purposes of subsection (1), the amounts levied for school purposes shall be deemed not to include any portion of the taxes for school purposes that is the difference between the amounts set out in paragraphs 1 and 2 of subsection 447.52 (3) or (4) of the Municipal Act.

(2)Section 257.11 of the Act, as amended by subsection (1), applies with respect to the 1999 and subsequent taxation years.

99.(1)Subsection 257.12 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 31, section 113 and amended by 1998, chapter 33, section 42, is further amended by striking out ``and" at the end of clause (b), by adding ``and" at the end of clause (c) and by adding the following clause:

(d)providing for the rebate of taxes for school purposes for 1998 and 1999 for properties to which section 447.7, subsection 447.9 (2) or subsection 447.10 (2) of the Municipal Act apply and for properties to which those provisions are made applicable by subsection 447.38 (1) of that Act, and specifying the circumstances under which the rebates are payable.

(2)The definition of ``tax rates for school purposes" in subsection 257.12 (1.1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 42, is repealed and the following substituted:

``tax rates for school purposes" includes tax rates for the purposes of,

(a)paying a board's share of the costs of rebates under section 442.1 or 442.2 of the Municipal Act\;

(b)making payments for the purposes of subsection 447.52 (3) or (4) of the Municipal Act\; or

(c)paying rebates under regulations under section 257.2.1 of this Act.

(3)The definition of ``tax rates for school purposes" in subsection 257.12 (1.1) of the Act, as re-enacted by subsection (2), applies with respect to the 1999 and subsequent taxation years.

100.(1)Section 257.12.2 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 44, is amended by adding the following subsections:

Regulations, accelerated rate reduction

(7.1)For greater clarity in interpreting this section, the Minister of Finance may make regulations to prescribe for a year before 2005 tax rates for school purposes in order to reduce the weighted average tax rate for school purposes for the commercial classes or the industrial classes below the maximum tax rate otherwise required under subsection (5).

General or specific

(7.2)A regulation under subsection (7.1) may be general or specific in its application and may treat different municipalities differently.

(2)Subsection 257.12.2 (8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 44, is amended by striking out "(3) to (7)" and substituting "(3) to (7.2)".

(3)Section 257.12.2 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 44, is amended by adding the following subsection:

Reduction below 3.3 per cent

(9.1)Nothing in this section affects the authority of the Minister of Finance to prescribe tax rates for school purposes under section 257.12 so that the weighted average tax rate for school purposes for the commercial classes or for the industrial classes for a municipality is less than 3.3 per cent.

Commencement

101.This Part comes into force on the day this Act receives Royal Assent.

Part VIII

Electricity Act, 1998

102.Section 92 of the Electricity Act, 1998 is amended by adding the following subsection:

Application of Corporations Tax Act

(8)Any amount payable under this section that remains unpaid after it becomes due may be collected as if it were a tax under the Corporations Tax Act.

103.Clause 95 (a) of the Act is repealed and the following substituted:

(a)the provisions of the Corporations Tax Act relating to returns, payments, assessments, refunds of overpayments, objections to assessments, appeals, and administration and enforcement apply, with necessary modifications; and

. . . . .

104.Section 96 of the Act is amended by adding the following subsections:

Retroactivity

(3)A regulation made under this section is, if it so provides, effective with reference to a period before it is filed.

cl. (1) (f), previous payments

(4)In a regulation made under clause (1) (f), the Minister may provide that payments made in 1999 before the regulation is made have been properly made under that regulation.

Commencement

105.This Part comes into force on the day this Act receives Royal Assent.

Part IX

Employer Health Tax Act

106.Clause (d) of the definition of ``eligible employer" in subsection 1 (1) of the Employer Health Tax Act, as enacted by the Statutes of Ontario, 1994, chapter 17, section 57, is repealed and the following substituted:

(d)a person that is exempt throughout the year from tax under Part I of the Income Tax Act (Canada) under any of paragraphs 149 (1) (a) to (d.6), (h.1), (o) to (o.2), (o.4) to (s.2) and (u) to (z) of that Act; or

107.(1)Paragraphs 1 and 2 of subsection 3 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 8, section 3, are repealed and the following substituted:

1.An employer who pays, for the year 2000 or a subsequent year, total Ontario remuneration for the year that exceeds $600,000 shall pay monthly instalments to the Minister at the prescribed times.

(2)Clause 3 (2) (a) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 8, section 3, is repealed and the following substituted:

(a)the employer pays total Ontario remuneration for the year of $600,000 or less.

(3)The definition of ``S" in subsection 3 (4) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 18, section 6, is amended by striking out ``or quarter, as applicable".

(4)Clause 3 (4.01) (b) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 18, section 6, is amended by striking out ``or quarter, as applicable".

108.Section 8 of the Act, as amended by the Statutes of Ontario, 1994, chapter 8, section 8, is further amended by adding the following subsection:

Revocation of waiver

(1.0.1)If a taxpayer or person who has filed a waiver under subclause (1) (a) (ii) subsequently files with the Minister a notice of revocation of the waiver, in the form approved by the Minister, the Minister shall not issue an assessment under subsection (1) in reliance on the waiver more than one year after the date on which the revocation is filed.

Commencement

109.(1)Subject to subsections (2) and (3), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 107 comes into force on January 1, 2000.

Same

(3)Section 106 shall be deemed to have come into force on January 1, 1999.

Part X

Fair Municipal Finance Act, 1997 (No. 2)

110.(1)Section 72 of the Fair Municipal Finance Act, 1997 (No. 2), as re-enacted by the Statutes of Ontario, 1997, chapter 43, Schedule F, section 3, is amended by adding the following subsection:

Same

(2)If the paragraph of section 3 of the Assessment Act that has been amended or repealed by this Act did not require that the land be owned by a particular person in order to be exempt from taxation, the paragraph continues to apply with respect to the land even if there has been a change in the ownership of the land so long as the land continues to be occupied and used as required by the paragraph before the change under this Act.

Transition

(2)If a person has paid an amount of tax to a municipality under section 72 of the Act that, as a result of subsection 72 (2) of the Act, is deemed not to have been payable, the clerk of the municipality shall amend the collector's roll accordingly and the municipality shall refund that amount to the person.

Commencement

111.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 110 shall be deemed to have come into force on January 1, 1998.

Part XI

Financial Administration Act

112.Section 1.1 of the Financial Administration Act, as re-enacted by the Statutes of Ontario, 1996, chapter 18, section 24, is amended by adding the following subsection:

Proceeds from the sale of assets

(1.1)For the purposes of clause (1) (b), the amount of the proceeds from the sale by Ontario (but not by a Crown agency) of an asset is determined using the formula,

A - ( B + C + D )

in which,

``A"is the amount received by Ontario on the sale of the asset,

``B"is the amount of all costs incurred by Ontario in creating and preserving the asset,

``C"is the amount of all costs incurred by Ontario to sell the asset, and

``D"is the sum of all amounts that, in the fiscal year in which the amount described by ``A" is received by Ontario, are allocated by the Executive Council for expenditure in that fiscal year or in a subsequent fiscal year for the capital or operating costs of projects designated by the Executive Council as priority projects.

113.Section 5 of the Act, as amended by the Statutes of Ontario, 1994, chapter 17, section 62, is further amended by adding the following subsection:

Delegation

(4)The Minister of Finance may, in writing, delegate to a person employed in the Ontario public service the authority to exercise any of the powers of the Minister of Finance under subsection (1) and may impose such conditions and restrictions on the delegation as the Minister considers appropriate.

Commencement

114.(1)Subject to subsection (2), this Part comes into force on the day the Act receives Royal Assent.

Same

(2)Section 112 shall be deemed to have come into force on April 1, 1999.

Part XII

Income Tax Act

115.(1)The definition of ``deputy head" in subsection 1 (1) of the Income Tax Act, as re-enacted by the Statutes of Ontario, 1993, chapter 29, section 1, is amended by striking out ``the Deputy Minister of National Revenue for Taxation" and substituting ``the Commissioner of Customs and Revenue appointed under section 25 of the Canada Customs and Revenue Agency Act (Canada)".

(2)The Table to subsection 1 (6) of the Act, as amended by the Statutes of Ontario, 1993, chapter 29, section 1, is further amended,

(a)by striking out ``Department of National Revenue" in Column 1 and substituting ``Canada Customs and Revenue Agency"\;

(b)by striking out ``Ministry of Finance" in Column 2 and substituting ``Ontario Ministry of Finance"\; and

(c)by striking out ``Deputy Minister of National Revenue for Taxation" in Column 1 and substituting ``Commissioner of Customs and Revenue".

116.Paragraph 7 of subsection 3 (1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 5, section 1, is repealed and the following substituted:

7.For 1999, the additional income tax shall equal the aggregate of,

i.20 per cent of the amount, if any, by which the gross tax amount of the individual for the taxation year exceeds $3,750, and

ii.36 per cent of the amount, if any, by which the gross tax amount of the individual for the taxation year exceeds $4,681.

8.For the 2000 and subsequent taxation years, the additional income tax for each taxation year shall equal the aggregate of,

i.20 per cent of the amount, if any, by which the gross tax amount of the individual for the taxation year exceeds $3,655, and

ii.36 per cent of the amount, if any, by which the gross tax amount of the individual for the taxation year exceeds $4,562.

117.(1)Clause (b) of the definition of ``income for the year" in subsection 4 (1) of the Act is amended by striking out ``paragraphs 115 (1) (a), (b) and (c) of the Federal Act" and substituting ``paragraphs 115 (1) (a), (b), (b.1) and (c) of the Federal Act".

(2)The definition of ``income for the year" in subsection 4 (1) of the Act, as amended by subsection (1), applies to taxation years ending after December 31, 1997.

(3)Clause 4 (5) (u) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 5, section 2, is repealed and the following substituted:

(u)39.5 per cent in respect of the 1999 taxation year;

(v)38.5 per cent in respect of the 2000 and subsequent taxation years.

(4)Clause 4 (7) (a) of the Act is amended by striking out ``paragraph 126 (7) (c) of the Federal Act" and substituting ``the definition of ``non-business-income tax" in subsection 126 (7) of the Federal Act".

(5)Section 4 of the Act, as amended by the Statutes of Ontario, 1992, chapter 25, section 2, 1996, chapter 1, Schedule C, section 4, 1996, chapter 18, section 2, 1996, chapter 24, section 12, 1997, chapter 10, section 2 and 1998, chapter 5, section 2, is further amended by adding the following subsections:

Same

(9.1)If a mutual fund trust's refund for a taxation year under section 132 of the Federal Act is equal to its refundable capital gains tax on hand at the end of that year, the trust is entitled to receive an additional refund for the taxation year in the amount determined using the formula,

(A + B ) - ( C + D )

in which,

``A"is the total of all amounts in respect of taxation years ending after 1995, each of which is calculated, in respect of a taxation year, by multiplying the amount added to the mutual fund trust's refundable capital gains tax on hand at the end of the taxation year by the percentage referred to in subsection (5) used in computing the tax payable under this section by the mutual fund trust for that year,

``B"is the total of all amounts in respect of taxation years ending after 1995, each of which, in respect of a taxation year, is the amount that would be the mutual fund trust's surcharge under section 3 for the taxation year if the amount calculated as described by ``A" for the year were its gross tax amount determined under subsection 3 (2) for the year,

``C"is the total of all amounts previously refunded to the mutual fund trust under this subsection, and

``D"is the total of all amounts refunded to the mutual fund trust under subsections (8) and (9) in respect of taxation years ending after 1995.

Same

(9.2)For the purposes of subsection (9.1), a mutual fund trust's refundable capital gains tax on hand at a particular time is the amount determined under section 132 of the Federal Act.

(6)Subsection 4 (10) of the Act is amended by striking out ``subsection (9)" in the seventh line and substituting ``subsections (9) and (9.1)".

(7)Section 4 of the Act, as amended by subsections (3), (5) and (6), applies to taxation years ending after December 31, 1998.

118.Section 5 of the Act is repealed.

119.Section 7 of the Act, as amended by the Statutes of Ontario, 1992, chapter 18, section 55, 1993, chapter 29, section 5, 1996, chapter 1, Schedule C, section 7, 1996, chapter 18, section 3 and 1998, chapter 34, section 68, is further amended by adding the following subsection:

Non-application

(6)This section does not apply with respect to a return filed on behalf of an individual by a trustee in bankruptcy under paragraph 128 (2) (e) or (h) of the Federal Act for a taxation year.

120.(1)Section 8 of the Act, as amended by the Statutes of Ontario, 1992, chapter 18, section 55, 1992, chapter 25, section 3, 1993, chapter 29, section 6, 1994, chapter 17, section 99, 1996, chapter 1, Schedule C, section 8, 1996, chapter 24, section 13, 1996, chapter 29, section 9, 1997, chapter 19, section 9, 1997, chapter 43, Schedule B, section 4, 1998, chapter 5, section 3, 1998, chapter 9, section 81 and 1998, chapter 34, section 69, is further amended by adding the following subsection:

Property tax credit extension for 1998, certain taxpayers

(7.1)For the purpose of clause (3) (a) or (3.1) (a), the amount of an individual's 1998 municipal tax that is due in 1999 and paid by the due date may be used to determine the individual's occupancy cost for 1998 or 1999, if the individual's principal residence in 1998 was in an area of jurisdiction of a school board in a territory without municipal organization.

(2)Paragraph 5 of subsection 8 (17) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule B, section 4, is repealed and the following substituted:

5.The individual may calculate the deduction to which he or she is entitled under subsection (9) as though the reference in that subsection to ``contributions he or she made in the taxation year to candidates, constituency associations or parties" read as if it were a reference to contributions he or she made to any of them in the calendar year.

121.Clause (b) of the definition of ``eligible individual" in subsection 8.3 (7) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 72, is repealed and the following substituted:

(b)who is not a child care operator that controls or manages a child care facility with an expectation of profit, and

. . . . .

122.(1)The definition of ``designated percentage" in subsection 8.5 (1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 74, is repealed and the following substituted:

``designated percentage" means, in respect of an individual for a month,

(a)if the individual has no qualified dependants at the beginning of the month, nil,

(b)if the individual has one qualified dependant at the beginning of the month, 20 per cent if the month ends before July 1, 1999 or 21 per cent if the month begins after June 30, 1999,

(c)if the individual has two qualified dependants at the beginning of the month, 40 per cent if the month ends before July 1, 1999 or 42 per cent if the month begins after June 30, 1999, and

(d)if the individual has three or more qualified dependants at the beginning of the month, 60 per cent if the month ends before July 1, 1999 or 63 per cent if the month begins after June 30, 1999. (``pourcentage dsign")

(2)The definition of ``A" in subsection 8.5 (5) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 74, is repealed and the following substituted:

``A" is the lesser of,

(a)the amount equal to the greater of,

(i)the amount determined by multiplying the individual's designated percentage for the month by the amount by which the individual's adjusted earned income for the base taxation year in relation to the month exceeds $5,000, and

(ii)50 per cent of the individual's qualifying child care expenses for the base taxation year in relation to the month for persons who are qualified dependants of the individual for the purposes of subdivision a.1 of Division E of Part I of the Federal Act, and

(b)the amount obtained by multiplying the number of qualified dependants in respect of whom the individual was an eligible individual at the beginning of the month by,

(i)$1,020, if the month ends before July 1, 1999, or

(ii)$1,100, if the month begins after June 30, 1999.

123.(1)Paragraph 2 of subsection 10 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 10, section 4, is repealed and the following substituted:

2.Subsections 152 (1), (1.11), (1.12), (2), (3), (3.1), (4), (4.01), (4.1), (4.2), (4.3), (4.4), (5), (6), (7) and (8).

(2)Paragraph 2 of subsection 10 (1) of the Act, as amended by subsection (1), is further amended by striking out ``and (8)" and substituting "(8) and (9)".

(3)Paragraph 3 of subsection 10 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 10, section 4, is amended by adding at the end ``and 156.1 (4)".

(4)Paragraph 3 of subsection 10 (1) of the Act, as amended by subsection (3), applies with respect to taxation years ending after December 31, 1993.

124.(1)Section 14 of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 16, is amended by inserting "(6.2)" after "(6.1)".

(2)Section 14 of the Act, as amended by subsection (1), applies with respect to 1996 and subsequent taxation years.

125.Subsection 19 (2) of the Act is amended by striking out the portion before clause (a) and substituting the following:

False statements or omissions

(2)Every person who, knowingly or under circumstances amounting to gross negligence, makes, participates in, assents to or acquiesces in the making of a false statement or omission in a return, form, certificate, statement or answer (in this section referred to as a ``return") that is filed or made in respect of a taxation year for the purposes of this Act or a regulation or a provision of the Federal Act or of the Federal Regulations as that provision applies for the purposes of this Act is liable to a penalty of the greater of $100 and 50 per cent of the amount, if any, by which,

. . . . .

126.Subsection 22.1 (13) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 34, section 79, is amended by striking out ``and then apply" in the fifth line and substituting ``and then the Provincial Minister may apply".

127.Clause 28 (4) (b) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 10, section 5, is amended by striking out ``the Department of National Revenue" and substituting ``the Canada Customs and Revenue Agency".

128.Subsection 37 (1) of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 22 and amended by 1997, chapter 10, section 6, is further amended by inserting "(4.1), (4.2)" after "(4)" in the first line.

129.Subsection 39 (2) of the Act is amended by inserting "(4.1), (4.2)" after "(4)" in the first line.

130.Subsection 48 (19) of the Act is amended by striking out ``the Deputy Minister of the Department of National Revenue for Taxation, or an official of the Department of National Revenue" in the third, fourth, fifth and sixth lines and substituting ``the Commissioner of Customs and Revenue, or an official of the Canada Customs and Revenue Agency".

131.(1)Subsection 49 (4) of the Act is amended by striking out ``the Deputy Minister of National Revenue for Taxation of Canada" in the second and third lines and substituting ``the Commissioner of Customs and Revenue".

(2)Clause 49 (4) (b) of the Act is repealed and the following substituted:

(b)designate officers of the Canada Customs and Revenue Agency to carry out such functions, duties and powers as are similar to those that are exercised by them under the Federal Act on behalf of the Commissioner of Customs and Revenue.

Commencement

132.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)The following provisions shall be deemed to have come into force on the date indicated:

1.On December 31, 1991, subsection 123 (1).

2.On January 1, 1994, subsections 123 (3) and (4).

3.On June 15, 1994, section 128.

4.On January 1, 1996, section 124.

5.On June 20, 1996, section 125.

6.On January 1, 1998, subsections 117 (1) and (2) and 120 (1) and section 121.

7.On June 18, 1998, section 129.

8.On July 1, 1998, section 126.

9.On January 1, 1999, section 116, subsections 117 (3), (5), (6) and (7) and 120 (2).

10.On July 1, 1999, section 122.

11.On June 17, 1999, subsection 123 (2).

12.On November 1, 1999, sections 115, 127, 130 and 131.

Part xiii

Land Transfer Tax Act

133.The Land Transfer Tax Act is amended by adding the following section:

Penalty, failure to pay tax

7.1If the Minister is satisfied that a person's failure to pay tax is attributable to fraud or wilful default, the Minister may assess a penalty against the person in an amount equal to the greater of $500 and 25 per cent of the tax that the person failed to pay.

134.(1)Subsection 9.2 (2) of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 10, section 17 and amended by 1998, chapter 5, section 30, is repealed and the following substituted:

Refund re newly-constructed home

(2)The Minister may refund, in the manner he or she directs and without interest, tax payable by a purchaser under this Act in respect of the acquisition by the purchaser of a newly-constructed home to be used by the purchaser as his or her principal residence,

(a)if the conveyance or the disposition for which the tax is payable under this Act in respect of the home occurs on or after May 8, 1996;

(b)if the agreement of purchase and sale to acquire the home is entered into by the purchaser before April 1, 2000; and

(c)if the home is occupied by the purchaser as his or her principal resident no later than December 31, 2000.

Same

(2.1)The maximum amount of tax refundable under subsection (2) in respect of the acquisition of a newly-constructed home is,

(a)$1,725, if the agreement of purchase and sale to acquire the home is entered into by the purchaser on or before March 31, 1999; or

(b)$2,000, if the agreement of purchase and sale to acquire the home is entered into by the purchaser after March 31, 1999 and before April 1, 2000.

(2)Subsection 9.2 (5) of the Act, as re-enacted by the Statutes of Ontario, 1997, chapter 10, section 17 and amended by 1998, chapter 5, section 30, is further amended by striking out ``December 31, 2000" in the amendment of 1998 and substituting ``December 31, 2001".

135.Subsection 14 (5) of the Act is amended by striking out ``the assessment or notice of disallowance with respect to which the appeal is made shall be vacated and any tax pursuant to such assessment shall be repaid to the appellant or the refund disallowed be paid to the appellant" in the twentieth, twenty-first, twenty-second, twenty-third, twenty-fourth and twenty-fifth lines and substituting ``the assessment or statement of disallowance with respect to which the appeal is taken shall be vacated and any tax paid pursuant to such assessment, or any refund disallowed pursuant to such statement of disallowance, shall be repaid or refunded to the appellant".

Commencement

136.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 134 shall be deemed to have come into force on April 1, 1999.

Part XIV

Local Roads Boards Act

137.(1)Subsection 21 (3) of the Local Roads Boards Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule F, section 7, is amended by striking out ``For the 1998 taxation year" at the beginning and substituting ``Commencing in the 1998 taxation year".

Transition

(2)If an amount greater than the amount permitted under subsection 21 (3) of the Act, as amended by subsection (1), was billed and paid for 1999 before the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent, the Board shall give the owner a refund or credit equal to the amount of the excess.

Commencement

138.This Part comes into force on the day this Act receives Royal Assent.

Part XV

Ministry of Government Services Act

139.(1)Subsection 8 (5) of the Ministry of Government Services Act is amended by inserting after ``Minister" in the first line ``or by the Ontario Realty Corporation".

(2)Section 8 of the Act is amended by adding the following subsection:

Definition

(7)In this section,

``Ontario Realty Corporation" means the Ontario Realty Corporation continued by subsection 2 (2) of the Capital Investment Plan Act, 1993.

140.Section 16 of the Act is repealed and the following substituted:

Procurement policies, public works

16.Before a contract is entered into for and in the name of the Crown in respect of the construction, renovation or repair of a public work, the Ministry shall invite tenders in accordance with the applicable policies and directives of the Management Board of Cabinet.

141.Subsection 19 (2) of the Act is repealed and the following substituted:

Delegation to Corporation

(2)The Minister may delegate his or her responsibility and powers under subsections 6 (1) and 8 (1) and (2) to the Ontario Realty Corporation, subject to such conditions as the Minister may impose.

Assignment

(3)The Minister may assign to the Ontario Realty Corporation the responsibilities and powers of the Minister, the Deputy Minister and the Ministry under clauses 6 (2) (a) and (b), subject to such conditions as the Minister may impose.

Effect

(4)Despite the Executive Council Act, an agreement that is signed by a person authorized to do so by a delegation or an assignment made under this section has the same effect as if the agreement had been signed by the Minister.

Definition

(5)In this section,

``Ontario Realty Corporation" means the Ontario Realty Corporation continued by subsection 2 (2) of the Capital Investment Plan Act, 1993.

Commencement

142.This Part comes into force on the day this Act receives Royal Assent.

Part XVI

Municipal Act

143.The Municipal Act is amended by adding the following section:

Regulation to provide reporting requirements

83.2(1)The Minister may, by regulation, require municipalities to provide the following information within the time and in the manner and form prescribed in the regulation:

1.By-laws made under any of Parts XXII, XXII.1 or XXII.2.

2.Any other information specified in the regulation.

General or specific

(2)A regulation made under subsection (1) may be general or specific in its application and may be restricted to one or more municipalities.

Definition

(3)In this section,

``municipality" means a city, town, village, township, county, a regional or district municipality or the County of Oxford.

144.(1)Section 159 of the Act, as amended by the Statutes of Ontario, 1994, chapter 17, section 49, 1997, chapter 29, section 28 and 1998, chapter 3, section 11, is further amended by adding the following subsections:

Same, re 1999

(5.0.1)For the purpose of determining interest payable on tax for 1999 under this section,

(a)one-half of the tax shall be deemed to have been payable on or before August 15, 1999; and

(b)one-quarter of the tax shall be deemed to have been payable on or before September 30, 1999.

Same

(5.0.2)The balance of the tax under this section for 1999 shall be paid on or before December 31, 1999.

Transition

(2)For 1999, the date by which the Minister of Finance must have mailed a notice of assessment under subsection 159 (5.1) of the Act is July 31.

145.Section 187 of the Act, as amended by the Statutes of Ontario, 1992, chapter 15, section 15, 1996, chapter 32, section 48 and 1998, chapter 33, section 9, is further amended by adding the following subsection:

Same

(18)Despite the limits set out in subsection (2) and paragraph 2 of subsection (17), if the amounts borrowed did not exceed 80 per cent during 1999, that borrowing shall be deemed to have been authorized under subsection (2).

146.Section 368.0.3 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 15, is amended by adding the following subsections:

Levy of tax rates for property classes separately for 1999

(6)Despite subsection (1), the council of a municipality may pass a by-law providing for the billing for 1999 of taxes on a class of real property separately from the other classes of real property if,

(a)Part XXII.2 does not apply to that class of real property; or

(b)the municipality has complied with subsection 368.0.2 (3) with respect to that class of real property.

Separate bills may be issued

(7)If a by-law has been passed under subsection (6), the collector of the municipality may issue separate bills for separate classes of real property for 1999.

Application

(8)Subsections (6) and (7) apply with respect to the 1999 taxation year.

147.Section 392 of the Act, as amended by the Statutes of Ontario, 1998, chapter 33, section 20, is further amended by adding the following subsections

By-law re separate billing in 2000

(4)The council of a local municipality may pass a by-law providing for the billing of a class of real property separately from the other classes of real property for 2000.

Separate bills may be issued

(5)If a by-law has been passed under subsection (4), the collector of the local municipality may issue separate bills for separate classes of real property for 2000.

148.Section 421 of the Act is amended by adding the following subsections:

Deficiency, Part XXII.1 or XXII.2

(2)Every municipal council that is required to pay over any money to a body for which it is required by law to levy rates or raise money shall, except where otherwise provided, supply out of the funds of the corporation any deficiency caused by the application of section 447.19 of Part XXII.1 or section 447.51 of Part XXII.2 and the council shall charge back a proportionate share of the deficiency to the body in the same proportion as that body shares with other bodies in the revenues from taxes.

Surplus, Part XXII.1 or XXII.2

(3)Every municipal council that is required to pay over any money to a body for which it is required by law to levy rates or raise money shall, except where otherwise provided, in respect of a property that is subject to Part XXII.1 or Division B of Part XXII.2, credit a proportionate share of any surplus to the body in the same proportion as that body shares with other bodies in the revenues from taxes.

Determination of deficiency or surplus

(4)For the purposes of subsections (1) and (3), if a property is subject to Part XXII.1 or Division B of Part XXII.2, any deficiency or surplus shall be determined by reference to the taxes determined under Part XXII.1 or Division B of Part XXII.2 and not to the taxes that would have been imposed but for the application of Part XXII.1 or Division B of Part XXII.2.

Application

(5)Subsections (2) to (4) apply with respect to the 1998, 1999 and 2000 taxation years.

149.(1)Paragraph 2 of subsection 442.1 (11.1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 22, is amended by striking out ``paragraphs 2 and 3" in the fourth line and substituting ``paragraphs 3 and 4".

(2)Section 442.1 of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 3, section 27 and amended by 1998, chapter 33, section 22, is further amended by adding the following subsections:

Application of Part XXII.2, Division C

(11.1.1)Where regulations are made under subsection (11.1.2), the following apply with respect to property to which Division C of Part XXII.2 applies:

1.The amount of the rebate required under paragraph 1 of subsection (3) may be determined in accordance with paragraph 2 of subsection (3) or in accordance with the regulations.

2.A rebate may be paid at the times and in the instalments provided for in paragraphs 3 and 4 of subsection (3) or at the times and in the instalments provided for in the regulations.

Regulations

(11.1.2)The Minister of Finance may make regulations for the purposes of subsection (11.1.1) respecting the amount of the rebate required under subsection (3) and the times at which and instalments in which it shall be paid.

Same

(11.1.3)A regulation made under subsection (11.1.2) may apply to any of the 1998, 1999 and 2000 taxation years.

(3)Clauses 442.1 (11.2) (a), (b) and (c) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 22, are amended by striking out ``Division B" wherever it appears and substituting in each case ``Division B or C".

150.The Act is amended by adding the following section:

Tax rebate for newly constructed properties

442.4(1)The council of a municipality, other than a lower-tier municipality, shall have a program to provide for tax rebates for 1998 and 1999 on property,

(a)that became subject to Part XXII.1 or Part XXII.2 after January 1, 1998 and before January 1, 2000; or

(b)that was subject to Part XXII.1 or XXII.2 on January 1, 1998 if improvements were made on it after January 1, 1998 and before January 1, 2000.

Application of tax rebate

(2)A tax rebate under this section applies only to property whose frozen assessment listing was changed under subsection 447.10 (2).

Calculation of rebate

(3)The amount of the tax rebate shall be calculated in accordance with the regulations.

Costs to be shared

(4)The costs of a rebate of taxes on a property under this section shall be shared by the municipalities and school boards that share in the revenue from the taxes on the property in the same proportion as the municipalities and school boards share in those revenues.

Regulations

(5)The Minister of Finance may make regulations,

(a)governing tax rebates under this section, including prescribing additional requirements a property must meet before being eligible for those rebates and governing procedural requirements for those rebates;

(b)prescribing the circumstances under which a rebate may be paid and the method of calculating the amount of such a rebate;

(c)requiring that tax rebates be provided for property if the property is added to the frozen assessment listing under section 447.7 or subsection 447.9 (2).

Same

(6)A regulation under subsection (5) may be general or specific in its application and may be restricted to those municipalities specified in the regulation.

151.(1)Paragraph 2 of subsection 444.1 (7) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 33, section 24, is amended by adding at the end ``or, if the Minister of Finance prescribes a later date, that later date".

(2)Paragraph 2 of subsection 444.1 (8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 29, is amended by adding at the end ``or, if the Minister of Finance prescribes a later date, that later date".

(3)Subsection 444.1 (8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 29 and amended by 1998, chapter 33, section 24, is further amended by adding the following paragraph:

3.Despite paragraph 2, for 1999, the notice must be given by the later of,

i.September 30, 1999, and

ii.30 days after the day the final 1999 tax notice is mailed by the local municipality.

(4)Section 444.1 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 29 and amended by 1998, chapter 33, section 24, is further amended by adding the following subsections:

Regulations

(16)The Minister of Finance may make regulations prescribing a date for the purposes of paragraph 2 of subsection (7) and for the purposes of paragraph 2 of subsection (8).

Same

(17)A regulation under subsection (16) may be general or specific in its application and may treat different municipalities differently.

152.(1)Paragraph 2 of subsection 444.2 (7) of the Act, as re-enacted by the Statutes of Ontario, 1998, chapter 33, section 25, is amended by adding at the end ``or, if the Minister of Finance prescribes a later date, that later date".

(2)Paragraph 2 of subsection 444.2 (8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 29, is amended by adding at the end ``or, if the Minister of Finance prescribes a later date, that later date".

(3)Subsection 444.2 (8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 29 and amended by 1998, chapter 33, section 25, is further amended by adding the following paragraph:

3.Despite paragraph 2, for 1999, the notice must be given by the later of,

i.September 30, 1999, and

ii.30 days after the day the final 1999 tax notice is mailed by the local municipality.

(4)Section 444.2 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 29 and amended by 1998, chapter 33, section 25, is further amended by adding the following subsections:

Regulations

(11)The Minister of Finance may make regulations prescribing a date for the purposes of paragraph 2 of subsection (7) and for the purposes of paragraph 2 of subsection (8).

Same

(12)A regulation under subsection (11) may be general or specific in its application and may treat different municipalities differently.

153.(1)Paragraph 5 of section 447.6 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30, is amended by adding at the end ``but shall not include any portion of the property occupied by the Government of Ontario or Canada, a government agency of Ontario or Canada or a municipality".

(2)Paragraph 5 of section 447.6 of the Act, as amended by subsection (1), applies with respect to the 1998 and subsequent taxation years.

154.(1)Subsection 447.7 (1) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30, is repealed and the following substituted:

Addition of properties

(1)This section sets out the changes to be made to the frozen assessment listing if this Part applies to a property after any of the following occur:

1.The property ceases to be exempt from taxation on the assessment roll for the 1999 or 2000 taxation year.

2.The property is added to the assessment roll for the 1999 or 2000 taxation year as a result of the subdivision or severance of land.

3.The property is assessed under subsection 33 (3) of the Assessment Act for 1998, 1999 or 2000.

(2)Subsection 447.7 (1) of the Act, as re-enacted by subsection (1), applies with respect to the 1998 and subsequent taxation years.

155.The Act is amended by adding the following section:

Changes to frozen assessment- subdivision or severance

447.7.1(1)This section sets out the changes to be made to the frozen assessment listing for a property from which a parcel of land was subdivided or severed.

Calculation of frozen assessment

(2)If paragraph 2 of subsection 447.7 (1) applies to a property, the total assessment of the property shall be reduced in the prescribed manner.

Regulations

(3)The Minister of Finance may make regulations prescribing the manner in which the total assessment of property shall be reduced for the purposes of subsection (2).

Application

(4)This section applies with respect to the 1998 and subsequent taxation years.

156.(1)Clause 447.10 (1) (b) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30, is repealed and the following substituted:

(b)an adjustment made on the assessment roll for the year as a result of the erection, alteration, enlargement or improvement of a building, a structure, machinery, equipment or a fixture that occurred during a previous year.

(2)Section 447.10 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30 and amended by 1998, chapter 33, section 30, is further amended by adding the following subsection:

Improvements to vacant land

(6)Subsection (3) also applies to increases in the assessment of vacant land on the assessment roll for 1999 or 2000 as a result of an improvement to that land if no portion of any building on the land is ready to be occupied.

(3)Section 447.10 of the Act, as amended by subsections (1) and (2), applies with respect to the 1998 and subsequent taxation years.

157.Section 447.13 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30, is amended by adding the following subsection:

Same

(1.1)Despite subsection (1), the average business rate for a municipality shall not be less than 0.25 or more than 0.75 for the 1998 and subsequent taxation years.

158.(1)The definition of ``uncapped 1998 taxes" in subsection 447.19 (5) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30, is repealed and the following substituted:

``uncapped 1998 taxes" means, in relation to a property,

(a)if this Part applies to the property for 1998, the taxes for municipal and school purposes that would have been imposed for 1998 but for the application of this Part,

(b)if this Part applies to the property for 1999, the taxes for municipal and school purposes that would have been imposed for 1999 but for the application of this Part,

(c)if this Part applies to the property for 2000, the taxes for municipal and school purposes that would have been imposed for 2000 but for the application of this Part. (``impts de 1998 non plafonns")

(2)Subsection 447.19 (6) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 3, section 30, is amended by striking out ``and to subsequent years" in the portion immediately before paragraph 1.

(3)Section 447.19 of the Act, as amended by subsections (1) and (2), applies with respect to the 1998 and subsequent taxation years.

159.Part XXII.1 of the Act is amended by adding the following section:

Cap for new properties

447.34.1(1)The purpose of this section is to ensure that eligible properties are taxed in 2000 under this Part at a level of assessment that is no higher than that of comparable properties.

Total assessment of eligible property for 2000

(2)Despite any other requirement of this Part, the total assessment on the frozen assessment listing of an eligible property for 2000 under this Part shall be the lesser of,

(a)the amount determined for the year or part of the year under this section; and

(b)the amount determined for the year or part of the year under this Part, but for the application of this section.

Determination of total assessment

(3)Each local municipality shall determine the total assessment for each eligible property for the year or part of the year as follows:

1.Determine the level of assessment for each property identified by the Corporation under subsection (5) as a comparable property by dividing the total assessment on the frozen assessment listing of the property for 2000 by the assessment on the assessment roll for 2000.

2.Determine the average of the levels of assessment for all comparable properties determined under paragraph 1.

3.Determine the level of assessment for the eligible property by dividing the total assessment of the property for the year, as determined under subsection 447.10 (2), by the assessment on the assessment roll for 2000.

4.Despite paragraph 3, if the eligible property has been assessed under section 33 or 34 of the Assessment Act for 2000, determine the level of assessment for the eligible property by dividing the total assessment of the property for the year or portion of the year, as determined under subsection 447.10 (2), by the sum of the assessment on the assessment roll for 2000 and the assessment under section 33 or 34 of the Assessment Act.

5.If the average level of assessment for comparable properties determined under paragraph 2 is less than the level of assessment of the eligible property determined under paragraph 3 or 4, as the case may be, the level of assessment for the eligible property shall be the amount determined under paragraph 2 rather than the amount determined under paragraph 3 or 4.

6.Determine the total assessment for the eligible property by multiplying the level of assessment determined under paragraph 3,4 or 5, as the case may be, by the assessment on the assessment roll for 2000 or by the sum of the assessment on the assessment roll for 2000 and the assessment under section 33 or 34 of the Assessment Act, as the case may be.

Changes to frozen assessments

(4)For the purposes of determining the assessments, referred to in subsection 447.5 (4), in the frozen assessment listing for 2000, the total assessment determined under subsection (3) shall be deemed to be the total assessment in paragraph 1 of subsection 447.10 (2).

Comparable properties identified

(5)The Corporation shall identify six comparable properties with respect to an eligible property for the purposes of this section or, if there are not six comparable properties, as many comparable properties as there are.

List provided to municipality

(6)The Corporation shall provide a list of the comparable properties identified under subsection (5) with respect to an eligible property to the local municipality as soon as is practicable,

(a)after the return of the assessment roll for the 2000 taxation year for eligible properties that are on the assessment roll; or

(b)after the mailing of the notice of assessment of the eligible property for the 2000 taxation year or portion thereof under section 33 or 34 of the Assessment Act.

List to be mailed to the owner

(7)The local municipality shall mail to the owner of each eligible property the list of the comparable properties and the determination made under subsection (3) with respect to that eligible property within 60 days after the date the list is received by the local municipality.

If no comparable property

(8)If the Corporation determines that there are no comparable properties with respect to an eligible property, subsection (3) does not apply with respect to the eligible property and,

(a)the Corporation shall give notice to the local municipality of its determination; and

(b)within 60 days after receiving the notice given under clause (a), the local municipality shall give notice to the owner of the property of the Corporation's determination and of the total assessment determined for the year or part of the year under this Part.

Appeal

(9)The owner of an eligible property may, within 90 days of the mailing of information under subsection (7), complain in writing to the Assessment Review Board concerning the properties on the list and request that up to six alternative properties be used as comparable properties for the purposes of this section.

Same

(10)If the Corporation has determined that there are no comparable properties with respect to an eligible property, the owner of the eligible property may, within 90 days after the owner is given the notice of determination under clause (8) (b), complain in writing to the Assessment Review Board concerning the determination and request that up to six specified properties be used as comparable properties for the purpose of this section.

Same

(11)Section 40 of the Assessment Act applies, with necessary modifications, to a complaint under subsection (9) or (10) as if it were a complaint under subsection 40 (1) of that Act.

Authority of the Assessment Review Board

(12)In a complaint under this section, the Assessment Review Board shall determine up to six comparable properties from among the comparable properties proposed by the complainant, by the Corporation or by either of them.

Determination by local municipality

(13)The local municipality shall determine the total assessment of the eligible property in accordance with the decision of the Assessment Review Board or the court.

Taxes not to exceed uncapped taxes

(14)Despite this section, the taxes for municipal and school purposes for 2000 shall not exceed the taxes for municipal and school purposes that would have been imposed but for the application of this Part.

Regulations

(15)The Minister of Finance may make regulations,

(a)defining ``eligible property" under this section to include,

(i)property to which section 447.7 or subsection 447.9 (2) first applied for 1998 or 1999 and to which the section or subsection, as the case may be, continues to apply for 2000, or

(ii)property to which section 447.7 and subsection 447.9 (2) do not apply for 1999 but to which the section or subsection does apply for 2000;

(b)providing for the determination of total assessment on the frozen assessment listing and changes to the frozen assessment listing for 2000 for an eligible property described in clause (a).

Definitions

(16)In this section,

``comparable properties" means properties that are similar lands in the vicinity, as provided under subsection 44 (2) of the Assessment Act, of the eligible property; (``biens comparables")

``Corporation" means the Ontario Property Assessment Corporation; (``Socit")

``eligible property" means a property to which subsection 447.10 (2),

(a)first applied for 1998 or 1999 and continues to apply for 2000, or

(b)applies for 2000 and did not apply for 1999,

and includes such other property as may be prescribed under clause (15) (a); (``bien admissible")

``vicinity" has the same meaning as under subsection 44 (2) of the Assessment Act, subject to the following:

1.A property located outside the local municipality in which the eligible property is located shall be deemed not to be in the vicinity.

2.Despite paragraph 1, a property located outside the upper-tier municipality in which the eligible property is located shall be deemed not to be in the vicinity if the property was reassessed under,

i.section 371 of this Act, as it read before its re-enactment by the Statutes of Ontario, 1997, chapter 5, section 55,

ii.section 135.3 of the Regional Municipalities Act, as it read before its repeal by the Statutes of Ontario, 1997, chapter 5, section 69,

iii.section 84.13 of the County of Oxford Act, as it read before its repeal by the Statutes of Ontario, 1997, chapter 5, section 65, or

iv.section 81 of the District Municipality of Muskoka Act, as it read before its repeal by the Statutes of Ontario, 1997, chapter 5, section 66. (" proximit")

160.Section 447.37 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 37, is amended by adding the following subsection:

Exception

(5.1)Despite subsection (5), this Part applies to property in the commercial classes and in the industrial classes to which subsection 4 (3) of the Municipal Tax Assistance Act applies, and this Part applies with respect to the 1998 and subsequent taxation years.

161.Section 447.43 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 37, is amended by adding the following paragraph:

4.Section 447.34.1 (Cap on new property).

162.(1)The definition of ``uncapped 1998 taxes" in subsection 447.51 (5) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 37, is repealed and the following substituted:

``uncapped 1998 taxes" means, in relation to a property, the following taxes, adjusted, in accordance with the regulations, with respect to reductions in taxes for school purposes and changes in taxes for municipal purposes:

1.If this Division applies to the property for 1998, the taxes for municipal and school purposes that would have been imposed for 1998 but for the application of this Part.

2.If this Division applies to the property for 1999, the taxes for municipal and school purposes that would have been imposed for 1999 but for the application of this Part.

3.If this Division applies to the property for 2000, the taxes for municipal and school purposes that would have been imposed for 2000 but for the application of this Part. (``impts de 1998 non plafonns")

(2)Subsection 447.51 (8) of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 37, is amended by striking out ``and to subsequent years" in the portion immediately before paragraph 1.

(3)Section 447.51 of the Act, as amended by subsections (1) and (2), applies with respect to the 1998 and subsequent taxation years.

163.Section 447.52 of the Act, as enacted by the Statutes of Ontario, 1998, chapter 33, section 37, is repealed and the following substituted:

Distribution of taxes

447.52(1)The following apply for the purpose of distributing among municipalities and school boards the taxes for municipal and school purposes determined under this Division:

1.The taxes that are for school purposes shall be distributed in accordance with sections 257.8 and 257.9 of the Education Act and the taxes that are for municipal purposes shall be distributed in accordance with paragraph 5.

2.For 1998 for all classes of real property and for 1999 and 2000 for the multi-residential property class, the taxes that are for school purposes on all property shall be equal to the taxes on the property for school purposes that would have been imposed on the property if this Division did not apply.

3.For 1999 and 2000 for the commercial classes and the industrial classes, the taxes that are for school purposes on all property in each class of real property shall be equal to 98 per cent of the taxes on the property for school purposes that would have been imposed on the property if this Division did not apply.

4.The taxes on all property for municipal purposes are the taxes minus the amount of the taxes for school purposes.

5.If the property specified in paragraph 3 is in an upper-tier municipality, the upper-tier municipality's share of the taxes for municipal purposes shall be equal to the sum of,

i.the taxes on the property for upper-tier purposes that would have been imposed on the property if this Division did not apply, and

ii.2 per cent of the taxes on the property for school purposes that would have been imposed on the property if this Division did not apply.

6.If a municipality is required to pay taxes to an upper-tier municipality under this Act or a school board under the Education Act, the amount the municipality is required to pay shall be adjusted to reflect the changes under this Division to the amount of the taxes and their distribution.

Adjustments re surplus or shortfall

(2)The council of an upper-tier municipality to which this Division applies shall pass a by-law requiring adjustments to be made between the upper-tier and the lower-tier municipalities so that neither the upper-tier municipality nor any lower-tier municipalities has a surplus or shortfall as a result of adjustments under paragraph 3 of subsection 447.47 (1).

Same

(3)In making a by-law under subsection (2), the council of the upper-tier municipality shall, separately for all of the commercial classes and for all of the industrial classes, determine the difference between the following amounts and apply that amount to increase the percentage determined under subsection 447.51 (4):

1.The sum of the taxes for school purposes for all property in the commercial classes or the industrial classes, as the case may be, in the lower-tier municipality that would have been imposed on all property in those classes if this Division did not apply.

2.The sum of the taxes for school purposes determined under paragraph 3 of subsection (1) for all property in the commercial classes or the industrial classes, as the case may be, in the lower-tier municipality.

Same

(4)The council of the single-tier municipality shall, separately for all of the commercial classes and for all of the industrial classes, determine the difference between the following amounts and apply that amount to increase the percentage determined under subsection 447.51 (4):

1.The sum of the taxes for school purposes for all property in the commercial classes or the industrial classes, as the case may be, in the municipality that would have been imposed on all property in those classes if this Division did not apply.

Application

(5)This section applies with respect to the 1998 and subsequent taxation years.

O. Reg. 703/98 authorized

164.The regulation-making authority under subsection 363 (16) of the Act shall be deemed to have been retroactive for the purpose of authorizing Ontario Regulation 703/98 and it is confirmed that Ontario Regulation 703/98 shall be deemed to have come into force on July 24, 1998.

Commencement

165.This Part comes into force on the day this Act receives Royal Assent.

Part xvii

Northern Services Boards Act

166.(1)Subsection 23 (6) of the Northern Services Boards Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule F, section 8, is amended by striking out ``For the 1998 taxation year" at the beginning and substituting ``Commencing in the 1998 taxation year".

Transition

(2)If an amount greater than the amount permitted under subsection 23 (6) of the Act, as amended by subsection (1), was billed and paid for 1999 before the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent, the owner shall be given a refund or credit equal to the amount of the excess.

Commencement

167.This Part comes into force on the day this Act receives Royal Assent.

Part xviii

Ontario Guaranteed Annual Income Act

168.(1)Clause (b) of the definition of ``eligible person" in section 1 of the Ontario Guaranteed Annual Income Act is repealed and the following substituted:

(b)is actually residing in Ontario and is entitled to receive a supplement that is paid to the person or to his or her credit through the Ontario regional office of the Income Security Programs Branch of Human Resources Development Canada.

(2)The definition of ``fiscal year" in section 1 of the Act is repealed and the following substituted:

``fiscal year" means, in relation to a month,

(a)the period of 12 consecutive months, commencing on April 1, that includes the month, if the month is before April, 1998,

(b)the period commencing on April 1, 1998 and ending on June 30, 1999, if the month is in that period, or

(c)the period of 12 consecutive months, commencing on July 1, that includes the month, if the month is after June, 1999. (``exercice")

(3)The definition of ``income for the base calendar year" in section 1 of the Act is repealed and the following substituted:

``income for the base calendar year" of a person means the person's income, as defined in section 2 of the Old Age Security Act (Canada), for that calendar year. (``revenu pour l'anne de rfrence")

(4)The definition of ``Minister" in section 1 of the Act is repealed and the following substituted:

``Minister" means the Minister of Finance. (``ministre")

(5)The definition of ``spouse" in section 1 of the Act is repealed and the following substituted:

``spouse" has the same meaning as in section 2 of the Old Age Security Act (Canada). (``conjoint")

(6)The definition of ``spouse's allowance" in section 1 of the Act is repealed and the following substituted:

``spouse's allowance" means a monthly guaranteed income supplement authorized to be paid under Part III of the Old Age Security Act (Canada). (``allocation au conjoint")

169.Clause 2 (1) (b) of the Act is repealed and the following substituted:

(b)is actually resident in Ontario and is entitled to receive a partial monthly pension authorized to be paid under subsection 3 (2) of the Old Age Security Act (Canada) and to receive a supplement that is paid to the person or to his or her credit through the Ontario regional office of the Income Security Programs Branch of Human Resources Development Canada.

170.Section 3 of the Act is amended by adding the following subsection:

Waiver of application

(2.1)Despite subsection (2), if, under subsection 11 (4) of the Old Age Security Act (Canada), the Minister of Human Resources Development for Canada waives the requirement for an application for payment of a supplement under that Act for any month or months, no application need be made by or on behalf of the same person for payment of an increment under this Act for the same month or months.

171.(1)Section 6 of the Act is amended by adding the following subsection:

Minister may estimate income

(1.1)If, by reason of subsection 3 (2.1), an applicant is not required to make an application for payment of an increment for any month, the Minister may, on the basis of any information available to the Minister,

(a)estimate the applicant's income for the base calendar year; and

(b)in the case of an applicant who is a person described in subsection 15 (2) of the Old Age Security Act (Canada), as modified by section 7 of this Act, estimate the income of the applicant's spouse for the base calendar year.

(2)Subsections 6 (2), (3), (4) and (5) of the Act are amended by striking out ``a statement as described in clause 7 (2) (a)" wherever it appears and substituting in each case ``a statement as described in paragraph 15 (2) (a) of the Old Age Security Act (Canada), as modified by section 7 of this Act".

172.Section 7 of the Act is repealed and the following substituted:

Information required with application

7.(1)Section 15 of the Old Age Security Act (Canada) shall be deemed to be a part of this Act and, for such purpose, references in that section to the following words or expressions shall be read as indicated:

1.References to a supplement shall be read as if they were references to an increment.

2.References to a payment period shall be read as if they were references to a fiscal year.

3.References to a pensioner shall have the meaning given to that term by section 2 of that Act.

4.References to prescribed forms shall be read as if they were references to forms prescribed for the purposes of that Act, unless the Minister of Finance has approved forms for use under this Act in their place.

5.References to subsection 11 (4) of that Act shall be read as if they were references to subsection 3 (2.1) of this Act.

6.References to subsection 14 (1.1) of that Act shall be read as if they were references to subsection 6 (1.1) of this Act.

Non-duplication of process

(2)Applications, statements, notifications, income estimates and other information provided by a person to the Minister of Human Resources Development for Canada under the Old Age Security Act (Canada) may be treated by the Minister of Finance as applications, statements, notifications, income estimates and other information provided for the purposes of this Act, and the Minister of Finance may rely on all directions and cancellations of directions given by the Minister of Human Resources Development for Canada under section 15 of the Old Age Security Act (Canada) as if they had been given by the Minister of Finance, with necessary modifications, for the purposes of this Act.

173.Subsection 9 (8) of the Act is amended by striking out ``Ministry of Revenue" in the fifth and sixth lines and substituting ``Ministry of Finance".

174.(1)Subsection 11 (1) of the Act is amended by striking out ``Ministry of Revenue" in the fourth line and substituting ``Ministry of Finance".

(2)Subsection 11 (2) of the Act is repealed and the following substituted:

Disclosure of information

(2)Any information referred to in subsection (1) that is obtained by any officer, employee or agent of the Ministry of Finance in the administration of this Act may be communicated,

(a)to any officer or employee of the Ministry of Community and Social Services, Human Resources Development Canada, the Department of National Revenue and the Canada Customs and Revenue Agency; and

(b)to any person or class of persons who administers a program of assistance payments similar in nature to the payments authorized under this Act and who is prescribed by the Lieutenant Governor in Council.

175.(1)Subsection 15 (1) of the Act is amended by adding ``and" at the end of clause (b), by striking out ``and" at the end of clause (c) and by striking out clause (d).

(2)Subsection 15 (3) of the Act is repealed and the following substituted:

Copies of documents and records

(3)Where a book, record or other document has been examined or produced under this section, the person by whom it is examined or to whom it is produced, or any officer of the Ministry of Finance, may make or cause to be made one or more copies of them, and a document purporting to be certified by the Minister or a person authorized by the Minister to be a copy made under this section is admissible in evidence and has the same probative force as the original document would have had if it had been proven in the ordinary way.

176.Subsection 17 (2) of the Act is amended by adding the following clause:

(n)prescribing persons or classes of persons, if they are approved by Human Resources Development Canada, for the purpose of clause 11 (2) (b).

Commencement

177.(1)Subject to subsections (2) and (3), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Subsection 168 (2) shall be deemed to have come into force on March 31, 1999.

Same

(3)Subsections 168 (3) and (5) and sections 170, 171 and 172 shall be deemed to have come into force on July 1, 1999.

Part xix

Provincial Land Tax Act

178.Section 1 of the Provincial Land Tax Act is amended by adding the following definition:

``Minister" means the Minister of Finance and ``Ministry" has a corresponding meaning. (``ministre", ``ministre")

179.Subsections 10 (12), 11 (9), 17 (2), 26 (1) and (3), 33 (1), as amended by the Statutes of Ontario, 1997, chapter 19, section 19, and 33 (3) and (4), section 34 and clause 38 (1) (h) of the Act are amended by striking out ``Minister of Revenue", ``Deputy Minister of Revenue" and ``Ministry of Revenue" where they occur and substituting ``Minister", ``Deputy Minister" or ``Ministry", as the case may be.

180.(1)Subsections 11 (4) and (5) of the Act are repealed and the following substituted:

Rate of tax in 1999

(4)For 1999, every telegraph and telephone company that is required to file a statement under subsection (1) shall pay a tax to the Crown in right of Ontario equal to 4 per cent of the total gross receipts that are required to be shown by the company in the statement to be transmitted by it for 1999 under subsection (1).

Rate of tax in 2000 and subsequent years

(4.1)For 2000 and subsequent years, every telegraph and telephone company that is required to file a statement under subsection (1) shall pay a tax to the Crown in right of Ontario equal to 4 per cent, or such lower percentage as the Minister may prescribe, of the gross receipts that are required to be shown by the company in the statement to be transmitted by it for the year under subsection (1).

Tax bill for 1999

(5)The tax levied under this section for 1999 becomes due and is payable on or before December 31, 1999 and a bill for the amount imposed shall be mailed by the collector to the head office of every telegraph and telephone company subject to tax under this section or to such other address as the company has directed in writing to the collector, on or before December 15, 1999.

Tax bill for 2000 and subsequent years

(5.1)The tax levied under this section for the years after 1999 becomes due and is payable in four equal instalments on March 31, June 30, September 30 and December 31 in the year in which it is imposed, and a bill for the amount imposed shall be mailed by the collector to the head office of every telegraph and telephone company subject to the tax under this section or to such other address as the company has directed in writing to the collector, within 15 days after the company transmits a statement under subsection (1).

(2)Section 11 of the Act is amended by adding the following subsection:

Regulations

(12)The Minister may make regulations prescribing a percentage for the purposes of subsection (4.1).

181.(1)Subsection 21 (5) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 43, Schedule F, section 11, is amended by striking out ``For the 1998 taxation year" at the beginning and substituting ``Commencing in the 1998 taxation year".

Transition

(2)If an amount greater than the amount permitted under subsection 21 (5) of the Act, as amended by subsection (1), was billed and paid for 1999 before the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent, the owner shall be given a refund or credit equal to the amount of the excess.

182.Subsection 21.1 (2) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 31, section 166, is repealed and the following substituted:

Interpretation

(2)Subject to subsection (5), except as otherwise provided under any other Act, property is rateable for school purposes if it is liable to assessment and taxation under the Assessment Act.

Commencement

183.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Section 182 shall be deemed to have come into force on January 1, 1998.

Part xx

Retail Sales Tax Act

and Complementary Amendments

Retail Sales Tax Act

184.(1)Subsection 7 (1) of the Retail Sales Tax Act, as amended by the Statutes of Ontario, 1992, chapter 13, section 4, 1994, chapter 13, section 9, 1996, chapter 29, section 26, 1997, chapter 10, section 32, 1997, chapter 41, section 125 and 1998, chapter 5, section 45, is further amended by adding the following paragraph:

13.1Farm supplies, as defined by the Minister, that in his or her opinion are to be used exclusively in the business of farming by a person engaged in the business of farming.

(2)Paragraph 19 of subsection 7 (1) of the Act is repealed and the following substituted:

19.Materials and equipment required for irrigation purposes, repairs to such equipment, and drainage tiles, when such materials, equipment or tiles are purchased to be used exclusively in the business of farming by a person who, with respect to the purchase, provides a written statement to the vendor stating that the materials, equipment or tiles will be used exclusively in the business of farming. The statement must be signed by,

i.the person engaged in the business of farming who will use the materials, equipment or tiles, or

ii.a responsible official of a municipality that is carrying out a municipal drainage project for which the materials, equipment or tiles are purchased for the use of persons engaged in the business of farming.

185.Subsections 15.1 (3) and (4) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 13, section 11, are repealed and the following substituted:

Penalty, not delivering return

(3)Every person to whom this section applies who fails to deliver a return as required by this Act and the regulations shall pay a penalty of an amount equal to 5 per cent of the tax payable by the person for the period in respect of which the return should have been delivered.

Penalty, not remitting tax

(4)Every person to whom this section applies who delivers the return as required by this Act and the regulations but who fails to remit with that return the full amount of tax payable by the person as shown on the return shall pay a penalty of an amount equal to 5 per cent of the tax payable by the person and not remitted.

One penalty

(5)Where a penalty under subsection (3) has been assessed, no penalty for failing to deliver a return shall be assessed under subsection 32 (1) for that failure.

Same

(6)Where a penalty under subsection (4) has been assessed, no penalty for failing to remit tax payable by the person shall be assessed under subsection 32 (2) for that failure.

186.Subsection 19 (1) of the Act, as re-enacted by the Statutes of Ontario, 1992, chapter 13, section 6 and amended by 1994, chapter 13, section 14 and 1996, chapter 29, section 31, is repealed and the following substituted:

Penalty assessment

(1)The Minister may assess any penalty payable by a vendor under subsection 32 (1) or (2) or by a person under subsection 15.1 (3) or (4) or any amounts owing by a person dealing with a non-resident contractor who fails to comply with subsection 39 (4).

187.Section 26 of the Act is amended by striking out ``the assessment with respect to which the appeal is taken shall be vacated and any tax paid pursuant to such assessment shall be repaid to the appellant" in the twentieth, twenty-first, twenty-second and twenty-third lines and substituting ``the assessment or statement with respect to which the appeal is taken shall be vacated and any tax paid pursuant to such assessment, or any refund disallowed pursuant to such statement, shall be repaid or refunded to the appellant".

188.Subsection 32 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 13, section 19, is repealed and the following substituted:

Penalty, not delivering return

(1)Every vendor who fails to deliver a return as required by this Act and the regulations shall pay a penalty of an amount equal to 10 per cent of the tax collectable by the vendor and 5 per cent of the tax payable by the vendor for the period in respect of which the return should have been delivered.

Penalty, not remitting tax

(2)Every vendor who delivers the return as required by this Act and the regulations but who fails to remit with that return the full amount of tax collectable or payable by the vendor as shown on the return shall pay a penalty of an amount equal to 10 per cent of the tax collectable by the vendor and not remitted and 5 per cent of the tax payable by the vendor and not remitted.

One penalty

(3)Where a penalty under subsection (1) has been assessed, no penalty for failing to deliver a return shall be assessed under subsection 15.1 (3) for that failure.

Same

(3.1)Where a penalty under subsection (2) has been assessed, no penalty for failing to remit tax payable by the vendor shall be assessed under subsection 15.1 (4) for that failure.

189.(1)Clause 48 (3) (m) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 18, section 18 and amended by 1997, chapter 10, section 34 and 1998, chapter 5, section 47, is further amended by striking out ``and not later than March 31, 1999" in the fifth and sixth lines.

(2)Subsection 48 (3) of the Act, as amended by the Statutes of Ontario, 1993, chapter 12, section 14, 1994, chapter 13, section 25, 1996, chapter 18, section 18, 1997, chapter 10, section 34, 1997, chapter 19, section 22, 1997, chapter 43, Schedule D, section 14 and 1998, chapter 5, section 47, is further amended by adding the following clause:

(o)providing for a rebate to the owner of a qualifying heritage property, as defined by the Minister, of up to $3,000 per qualifying heritage property of the tax paid in respect of tangible personal property that is purchased after May 4, 1999 and before December 31, 2000 and incorporated into real property pursuant to an eligible project, as defined by the Minister, for the conservation or restoration of a qualifying heritage property, and prescribing criteria or conditions for applying for and paying the rebate.

Retail Sales tax Amendment Act, 1994

190.Subsection 19 (1) of the Retail Sales Tax Amendment Act, 1994 is repealed.

Good Financial Management Act, 1996

191.Section 31 of the Good Financial Management Act, 1996 is repealed.

Commencement

192.(1)Subject to subsections (2) and (3), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Sections 185, 186 and 188 come into force on a day to be named by proclamation of the Lieutenant Governor.

Same

(3)The following provisions shall be deemed to have come into force on the date indicated:

1.On April 1, 1999, subsection 189 (1).

2.On May 5, 1999, subsections 184 (1) and 189 (2).

Part xxi

Securities Act

193.(1)The definition of ``clearing agency" in subsection 1 (1) of the Securities Act is amended,

(a)by striking out ``and" in the fourth line and substituting ``or"\; and

(b)by adding ``or provides centralized facilities as a depository of securities, but does not include a stock exchange, a quotation and trade reporting system or a registered dealer" at the end.

(2)The definition of ``distribution" in subsection 1 (1) of the Act is amended by striking out ``and" at the end of clause (d), by adding ``and" at the end of clause (e) and by adding the following clause:

(f)any trade that is a distribution under the regulations.

(3)The definition of ``market participant" in subsection 1 (1) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 11, section 350, is amended by adding ``a recognized quotation and trade reporting system," after ``recognized clearing agency" in the eighth line.

(4)Subsection 1 (1) of the Act, as amended by the Statutes of Ontario, 1994, chapter 11, section 350, 1994, chapter 33, section 1 and 1997, chapter 19, section 23, is further amended by adding the following definition:

``offering memorandum" means a document, together with any amendments to that document, purporting to describe the business and affairs of an issuer that has been prepared primarily for delivery to and review by a prospective purchaser so as to assist the prospective purchaser to make an investment decision in respect of securities being sold in a distribution to which section 53 would apply but for the availability of one or more of the exemptions contained in Ontario securities law, but does not include a document setting out current information about an issuer for the benefit of a prospective purchaser familiar with the issuer through prior investment or business contacts. (``notice d'offre")

(5)Clause (b) of the definition of ``reporting issuer" in subsection 1 (1) of the Act is repealed and the following substituted:

(b)that has filed a prospectus and has obtained a receipt for it under this Act,

(b.1)that has filed a securities exchange takeover bid circular under this Act before the date on which the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent.

(6)The definition of ``reporting issuer" in subsection 1 (1) of the Act is amended by striking out ``or" at the end of clause (d), by adding ``or" at the end of clause (e) and by adding the following clause:

(f)that the Commission has deemed to be a reporting issuer under section 83.1.

(7)Clauses (m) and (n) of the definition of ``security" in subsection 1 (1) of the Act are repealed and the following substituted:

(m)any income or annuity contract not issued by an insurance company,

(n)any investment contract.

(8)Clause (b) of the definition of ``trade" or ``trading" in subsection 1 (1) of the Act is repealed and the following substituted:

(b)any participation as a trader in any transaction in a security through the facilities of any stock exchange or quotation and trade reporting system.

194.Subsection 3.5 (4) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 10, section 37, is amended by inserting ``except section 17" after ``under Part VI" in the second and third lines.

195.Subsection 8 (1) of the Act is repealed and the following substituted:

Review of decision

(1)Within 30 days after a decision of the Director, the Commission may notify the Director and any person or company directly affected of its intention to convene a hearing to review the decision.

196.Section 17 of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 11, section 358, is amended by adding the following subsections:

Disclosure in investigation or proceeding

Disclosure to police

(7)Without the written consent of the person from whom the testimony was obtained, no disclosure shall be made under subsection (6) of testimony given under subsection 13 (1) to,

(a)a municipal, provincial, federal or other police force or to a member of a police force; or

(b)a person responsible for the enforcement of the criminal law of Canada or of any other country or jurisdiction.

197.Subsection 19 (3) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 11, section 358, is repealed and the following substituted:

Provision of information to Commission

(3)Every market participant shall deliver to the Commission at such time or times as the Commission or any member, employee or agent of the Commission may require,

(a)any of the books, records and documents that are required to be kept by the market participant under Ontario securities law; and

(b)except where prohibited by law, any filings, reports or other communications made to any other regulatory agency whether within or outside of Ontario.

198.Part VIII of the Act is amended by adding the following section:

Restriction on shareholdings in The Toronto Stock Exchange Inc.

21.11(1)Without the prior approval of the Commission, no person or company and no combination of persons or companies acting jointly or in concert shall beneficially own or exercise control or direction over more than 5 per cent, or such other percentage as may be prescribed under subsection (5), of any class or series of voting shares of The Toronto Stock Exchange Inc.

Sale of restricted shares

(2)The Toronto Stock Exchange Inc. may sell any shares held contrary to the restriction in subsection (1) in accordance with section 45 of the Business Corporations Act, with necessary modifications.

Transition

(3)Despite subsection (1), if a person or company beneficially owns or exercises control or direction over more than 5 per cent, or such other percentage as may be prescribed under subsection (5), of any class or series of voting shares of The Toronto Stock Exchange Inc. as a result of the issue of shares by The Toronto Stock Exchange Inc. in connection with the continuance of The Toronto Stock Exchange under the Business Corporations Act, the person or company may continue to beneficially own or exercise control or direction over the shares, but shall not vote or cause to permit to be voted any shares of any class or series of voting shares in excess of the 5 per cent level or the prescribed level, as the case may be, without the prior approval of the Commission.

Approval

(4)The Commission may, by order, give its approval to a person, company or transaction, for the purposes of subsection (1) or (3), and may impose such terms and conditions on the approval as the Commission considers appropriate.

Regulations

(5)The Commission may, by regulation, prescribe a percentage for the purposes of subsections (1) and (3) and may prescribe different percentages for different classes of persons or companies.

Non-application of s. 42 Business Corporations Act

(6)Section 42 of the Business Corporations Act does not apply to The Toronto Stock Exchange Inc.

199.(1)Clause 25 (1) (a) of the Act is amended by inserting ``or act as an underwriter" after ``trade in a security" in the first line and by adding ``or" at the end.

(2)Clause 25 (1) (b) of the Act is repealed.

(3)Clause 25 (1) (c) of the Act is amended by inserting ``as a representative or" before ``as a partner" in the third line.

200.Subsection 26 (1) of the Act is repealed and the following substituted:

Granting of registration

(1)Unless it appears to the Director that the applicant is not suitable for registration, renewal of registration or reinstatement of registration or that the proposed registration, renewal of registration, reinstatement of registration or amendment to registration is objectionable, the Director shall grant registration, renewal of registration, reinstatement of registration or amendment to registration to an applicant.

201.Section 32 of the Act is repealed.

202.Section 33 of the Act, as amended by the Statutes of Ontario, 1993, chapter 27, Schedule and 1994, chapter 11, section 362, is repealed.

203.(1)Subparagraph 3 iii.1 of subsection 35 (1) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 23, is repealed and the following substituted:

iii.1a subsidiary of any company referred to in subparagraph i, ii, ii.1 or iii, where the company owns all of the voting shares of the subsidiary.

(2)Paragraph 4 of subsection 35 (1) of the Act is amended by striking out ``other than an individual" in the third line.

(3)Paragraph 5 of subsection 35 (1) of the Act is amended by striking out "$97,000" at the end and substituting "$150,000 or such other amount as is prescribed".

(4)Paragraph 18 of subsection 35 (1) of the Act is amended by striking out "$100,000" at the end and substituting "$150,000 or such other amount as is prescribed".

(5)Paragraph 7 of subsection 35 (2) of the Act is amended by striking out ``no part of the net earnings of such issuer enure to the benefit of any security holder and" in the fifth, sixth and seventh lines.

204.Subsection 38 (3) of the Act is repealed and the following substituted:

Listing

(3)Subject to the regulations, no person or company, with the intention of effecting a trade in a security, shall, except with the written permission of the Director, make any representation, written or oral, that such security will be listed on any stock exchange or quoted on any quotation and trade reporting system, or that application has been or will be made to list such security upon any stock exchange or quote such security on any quotation and trade reporting system, unless,

(a)application has been made to list or quote the securities being traded, and securities of the same issuer are currently listed on any stock exchange or quoted on any quotation and trade reporting system; or

(b)the stock exchange or quotation and trade reporting system has granted approval to the listing or quoting of the securities, conditional or otherwise, or has consented to, or indicated that it does not object to, the representation.

205.Section 42 of the Act is repealed.

206.(1)Subsection 58 (1) of the Act is amended by inserting ``and subject to any waiver or variation consented to in writing by the Director," after ``subsection 63 (2)" in the second line.

(2)Subsection 58 (5) of the Act is amended by inserting ``or a guarantor" after ``promoter" in the second line.

(3)Subsection 58 (6) of the Act is amended by inserting "or who is a guarantor of the securities being distributed" after ``years" in the fourth line.

(4)Subsection 58 (7) of the Act is amended by inserting ``or a guarantor" after ``promoter" in the second line.

207.(1)Clause 72 (1) (d) of the Act is amended by striking out "$97,000" at the end and substituting "$150,000 or such other amount as is prescribed".

(2)Clause 72 (1) (l) of the Act is amended by striking out "$100,000" at the end and substituting "$150,000 or such other amount as is prescribed".

(3)Clause 72 (1) (m) of the Act is repealed and the following substituted:

(m)the trade is made by an issuer in a security of its own issue in consideration of mining claims where the vendor enters into such escrow or pooling agreement as the Director considers necessary or where the security proposed to be issued, or the security underlying that security, is listed and posted for trading on a stock exchange recognized for the purpose of this clause by the Commission and the issuer has received, where required by the by-laws, rules or policies of that stock exchange, the consent of that stock exchange to the issuance of the security.

(4)Subsection 72 (4) of the Act is amended by striking out ``other than a further trade exempted by subsection (1)" in the fourth and fifth lines and substituting ``other than a further trade exempted by Ontario securities law".

(5)Subsection 72 (5) of the Act is amended by striking out ``other than a further trade exempted by subsection (1)" in the sixth and seventh lines and substituting ``other than a further trade exempted by Ontario securities law".

(6)Subsection 72 (6) of the Act is amended by striking out ``other than a further trade exempted by subsection (1)" in the third and fourth lines and substituting ``other than a further trade exempted by Ontario securities law".

(7)Clause 72 (7) (a) of the Act is amended by striking out ``by subsection (1)" and substituting ``by Ontario securities law".

208.(1)Section 80 of the Act, as amended by the Statutes of Ontario, 1994, chapter 33, section 4, is further amended by inserting ``or other interested person or company" after ``application of a reporting issuer" in the first and second lines.

(2)Clause 80 (a) of the Act is repealed.

209.Section 83 of the Act is amended by striking out ``that has fewer than fifteen security holders whose latest address as shown on the books of the reporting issuer is in Ontario" in the second, third and fourth lines.

210.Part XVIII of the Act is amended by adding the following section:

Deeming an issuer to be a reporting issuer

83.1(1)The Commission may, upon the application of,

(a)an issuer, if the Commission considers that it would not be prejudicial to the public interest; or

(b)the Director, if the Commission considers that it would be in the public interest,

make an order deeming the issuer to be a reporting issuer for the purposes of Ontario securities law.

Opportunity to be heard

(2)The Commission shall not make an order under clause (1) (b) without giving the issuer an opportunity to be heard.

211.(1)Paragraphs 2, 3 and 4 of section 95 of the Act are repealed and the following substituted:

Minimum deposit period

2.The offeror shall allow at least 35 days from the date of the bid during which securities may be deposited pursuant to the bid.

When taking up prohibited

3.No securities deposited pursuant to the bid shall be taken up by the offeror until the expiration of 35 days from the date of the bid.

Withdrawal rights

4.Securities deposited pursuant to the bid may be withdrawn by or on behalf of a depositing security holder,

i.at any time where the securities have not been taken up by the offeror,

ii.at any time before the expiration of 10 days from the date of a notice of change or variation under section 98, and

iii.if the securities have not been paid for by the offeror within three business days after having been taken up.

(2)Paragraph 10 of section 95 of the Act is repealed and the following substituted:

Same

10.Any securities that are taken up by the offeror under the bid shall be paid for by the offeror as soon as possible, and in any event not more than three business days, after the taking up of the securities.

(3)Paragraph 12 of section 95 of the Act is repealed and the following substituted:

Extension restricted

12.A bid may not be extended by the offeror, where all the terms and conditions thereof have been complied with except those waived by the offeror, unless the offeror first takes up all securities deposited thereunder and not withdrawn.

(4)Section 95 of the Act, as amended by the Statutes of Ontario, 1994, chapter 11, section 349, is further amended by adding the following paragraph:

Same

12.1Despite paragraph 12, if the offeror waives any terms or conditions of a bid and extends the bid in circumstances where the rights of withdrawal conferred by subparagraph 4 ii are applicable, the bid shall be extended without the offeror first taking up the securities which are subject to such rights of withdrawal.

212.Subsection 99 (1) of the Act, as amended by the Statutes of Ontario, 1993, chapter 27, Schedule, is repealed and the following substituted:

Directors' circular

(1)Where a take-over bid has been made, a directors' circular shall be prepared and delivered by the board of directors of an offeree issuer to every person and company to whom a take-over bid must be delivered under paragraph 1 of section 95 not later than 15 days after the date of the bid.

213.Section 100 of the Act is repealed and the following substituted:

Commencement of take-over bid

100.(1)A take-over bid may be commenced in accordance with either subsection (2) or subsection (7).

Commencement by delivery

(2)A take-over bid may, and an issuer bid shall, be commenced by delivering the bid to the security holders referred to in paragraph 1 of section 95 in accordance with subsection (6).

Filing and delivery to offeree issuer

(3)If a bid is commenced under subsection (2), the bid shall be filed and, in the case of a take-over bid, delivered to the offeree issuer's principal office on the same day as, or as soon as practicable after, the bid is delivered under subsection (2).

Notice of change or variation

(4)A notice of change or variation in respect of a bid shall be filed and, in the case of a take-over bid, delivered to the offeree issuer's principal office on the same day as, or as soon as practicable after, the notice of change or variation is delivered to holders of securities of the offeree issuer.

Directors' circulars

(5)Every directors' circular and every individual director's or officer's circular or any related notice of change that is delivered to security holders of an offeree issuer shall be filed and shall be delivered to the offeror's principal office on the day the directors' circular or individual director's or officer's circular or the notice of change is delivered to the holders of securities of the offeree issuer, or as soon as practicable thereafter.

Delivery and date of bid, etc.

(6)A take-over bid or issuer bid, a take-over bid circular, an issuer bid circular, a directors' circular, an individual director's or officer's circular and every notice of change or variation in any such bid or circular shall be mailed by prepaid first class mail or delivered by personal delivery or in such other manner as the Director may approve to the intended recipient and any bid, circular or notice so mailed or delivered shall be deemed to have been delivered and, subject to subsections (8) and (9), shall be deemed conclusively for the purposes of this Part and the regulations to have been dated as of the date on which it was so mailed or delivered to all or substantially all of the persons or companies entitled to receive it.

Commencing take-over bid by advertisement

(7)An offeror may commence a take-over bid by publishing an advertisement containing a brief summary of the bid in at least one major daily newspaper of general and regular paid circulation in Ontario, or by disseminating the advertisement in a prescribed manner, if,

(a)on or before the date of first publication or first dissemination of the advertisement, the offeror, or a person or company acting on its behalf, files the bid and delivers it to the offeree issuer's principal office, and files the advertisement;

(b)on or before the date of first publication or first dissemination of the advertisement, the offeror, or a person or company acting on its behalf, requests from the offeree issuer a list of the security holders referred to in paragraph 1 of section 95; and

(c)within two business days of the receipt by or on behalf of the offeror of a list of the security holders referred to in paragraph 1 of section 95, the bid is delivered to those security holders in accordance with subsection (6).

Same

(8)If a take-over bid is commenced in accordance with subsection (7), the bid shall be deemed conclusively for the purposes of this Part and the regulations to have been dated as of the date of first publication or first dissemination of the advertisement referred to in subsection (7).

Same

(9)If a take-over bid is advertised in accordance with subsection (7), and the offeror or a person or company acting on its behalf has complied with clauses (7) (a) and (b) but has not yet delivered the bid under clause (7) (c), a change or variation in the bid prior to the date on which the bid is delivered to security holders in accordance with clause (7) (c) that is advertised in a manner provided under subsection (7) shall be deemed conclusively for the purposes of this Part and the regulations to have been dated as of the date of first publication or first dissemination of the advertisement relating to the change or variation if,

(a)the advertisement contains a brief summary of the change or variation;

(b)on or before the date of first publication or first dissemination of the advertisement relating to the change or variation, the offeror, or a person or company acting on its behalf, files the notice of change or variation and delivers it to the offeree issuer's principal office, and files such advertisement; and

(c)within two business days of the receipt by or on behalf of the offeror of a list of the security holders referred to in paragraph 1 of section 95, the bid and the notice of change or variation is delivered to those security holders in accordance with subsection 98 (2) or 98 (4), as applicable, and subsection (6).

Same

(10)If an offeror, or a person or company acting on its behalf, satisfies the requirements of subsection (9), the notice of change or variation shall not be required to be filed and delivered under subsection (4).

214.Section 107 of the Act is repealed and the following substituted:

Report

107.(1)A person or company who becomes an insider of a reporting issuer, other than a mutual fund, shall, within 10 days from the day that he, she or it becomes an insider, or such shorter period as may be prescribed by the regulations, file a report as of the day on which he, she or it became an insider disclosing any direct or indirect beneficial ownership of or control or direction over securities of the reporting issuer as may be required by the regulations.

Same

(2)An insider who has filed or is required to file a report under this section or any predecessor section and whose direct or indirect beneficial ownership of or control or direction over securities of the reporting issuer changes from that shown or required to be shown in the report or in the latest report filed by the person or company under this section or any predecessor section shall, within 10 days from the day on which the change takes place, or such shorter period as may be prescribed by the regulations, file a report of direct or indirect beneficial ownership of or control or direction over securities of the reporting issuer as of the day on which the change took place and the change or changes that occurred, giving any details of each transaction as may be required by the regulations.

Same

(3)A person or company who becomes an insider of a reporting issuer by reason of subsection 1 (8) or (9) shall file the reports required by subsections (1) and (2) of this section for the previous six months or such shorter period that he or she was a director or officer of the reporting issuer within 10 days from the day that the issuer became an insider of a reporting issuer or the reporting issuer became an insider of another reporting issuer, as the case may be, or such shorter period as may be prescribed by the regulations.

215.Subsection 127 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 11, section 375, is amended by adding the following paragraphs:

7.An order that a person resign one or more positions that the person holds as a director or officer of an issuer.

8.An order that a person is prohibited from becoming or acting as a director or officer of any issuer.

216.The Act is amended by adding the following section:

Payment of investigation costs

127.1(1)If, in respect of a person or company whose affairs were the subject of an investigation, the Commission,

(a)is satisfied that the person or company has not complied with, or is not complying with, Ontario securities law; or

(b)considers that the person or company has not acted in the public interest,

the Commission may, after conducting a hearing, order the person or company to pay the costs of the investigation.

Payment of hearing costs

(2)If, in respect of a person or company whose affairs were the subject of a hearing, the Commission, after conducting the hearing,

(a)is satisfied that the person or company has not complied with, or is not complying with, Ontario securities law; or

(b)considers that the person or company has not acted in the public interest,

the Commission may order the person or company to pay the costs of or related to the hearing that are incurred by or on behalf of the Commission.

Payment of costs where offence

Costs

(4)For the purposes of subsections (1), (2) and (3), the costs that the Commission may order the person or company to pay include, but are not limited to, all or any of the following:

1.Costs incurred in respect of services provided by persons appointed or engaged under section 5, 11 or 12.

2.Costs of matters preliminary to the hearing.

3.Costs for time spent by the Commission or the staff of the Commission.

4.Any fee paid to a witness.

5.Costs of legal services provided to the Commission.

217.Section 129.1 of the Act, as enacted by the Statutes of Ontario, 1994, chapter 11, section 375, is repealed and the following substituted:

Limitation period

129.1Except where otherwise provided in this Act, no proceeding under this Act shall be commenced later than six years from the date of the occurrence of the last event on which the proceeding is based.

218.The Act is amended by adding the following section:

Liability for misrepresentation in offering memorandum

130.1(1)Where an offering memorandum contains a misrepresentation, a purchaser who purchases a security offered by the offering memorandum during the period of distribution shall be deemed to have relied on the misrepresentation if it was a misrepresentation at the time of purchase, and,

(a)the purchaser has a right of action for damages against the issuer and a selling security holder on whose behalf the distribution is made; or

(b)where the purchaser purchased the security from a person or company referred to in clause (a), the purchaser may elect to exercise a right of rescission against the person or company, in which case the purchaser shall have no right of action for damages against such person or company.

Defence

(2)No person or company is liable under subsection (1) if he, she or it proves that the purchaser purchased the securities with knowledge of the misrepresentation.

Limitation in action for damages

(3)In an action for damages pursuant to subsection (1), the defendant is not liable for all or any portion of the damages that the defendant proves do not represent the depreciation in value of the security as a result of the misrepresentation relied upon.

Joint and several liability

(4)Subject to subsection (5), all or any one or more of the persons or companies specified in subsection (1) are jointly and severally liable, and every person or company who becomes liable to make any payment under this section may recover a contribution from any person or company who, if sued separately, would have been liable to make the same payment, unless the court rules that, in all the circumstances of the case, to permit recovery of the contribution would not be just and equitable.

Same

(5)Despite subsection (4), an issuer shall not be liable where it is not receiving any proceeds from the distribution of the securities being distributed and the misrepresentation was not based on information provided by the issuer, unless the misrepresentation,

(a)was based on information that was previously publicly disclosed by the issuer;

(b)was a misrepresentation at the time of its previous public disclosure; and

(c)was not subsequently publicly corrected or superseded by the issuer prior to the completion of the distribution of the securities being distributed.

Limitation re amount recoverable

(6)In no case shall the amount recoverable under this section exceed the price at which the securities were offered.

No derogation of rights

(7)The right of action for rescission or damages conferred by this section is in addition to and without derogation from any other right the purchaser may have at law.

Application

(8)This section only applies,

(a)to an offering memorandum which has been furnished to a prospective purchaser in connection with a distribution of a security under an exemption from section 53; and

(b)in the circumstances specified in the regulations for the purposes of this section.

219.Subsection 140 (2) of the Act is amended by striking out ``by this Act" in the third line and substituting ``by Ontario securities law".

220.(1)Paragraph 7 of subsection 143 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is amended by adding ``or providing for exemptions from or varying the requirements under this Act in respect of the disclosure or furnishing of information to the public or the Commission by registrants" at the end.

(2)Paragraph 16 of subsection 143 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is repealed the following substituted:

16.Varying this Act to facilitate, expedite or regulate the distribution of securities or the issuing of receipts, including by establishing,

i.requirements in respect of distributions of securities by means of a prospectus incorporating other documents by reference,

ii.requirements in respect of distributions of securities by means of a simplified or summary prospectus or other form of disclosure document,

iii.requirements in respect of distributions of securities on a continuous or delayed basis,

iv.requirements in respect of pricing of distributions of securities after the issuance of a receipt for the prospectus filed in relation thereto,

v.procedures for the issuing of receipts for prospectuses after expedited or selective review thereof,

vi.provisions for the incorporation by reference of certain documents in a prospectus and the effect, including from a liability and evidentiary perspective, of modifying or superseding statements,

vii.requirements for the form of a prospectus certificate, including providing for alternative forms in circumstances other than those referred to in subsection 63 (2) of this Act,

viii.provisions for eligibility requirements to obtain a receipt for, or distribute under, a particular form of prospectus and the loss of that eligibility, and

ix.provisions for varying withdrawal rights.

(3)Subparagraph 28 ii of subsection 143 (1) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is amended by adding ``varying the requirements of or" at the beginning.

(4)Subparagraph 28 iii of subsection 143 (1) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is amended by striking out ``section 95" and substituting ``sections 95, 96, 97, 98, 99 or 100 or providing exemptions therefrom".

(5)Subparagraph 28 iv of subsection 143 (1) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is amended by adding ``varying the requirements of or" at the beginning.

(6)Paragraph 28 of subsection 143 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is amended by striking out ``and" at the end of subparagraph v and by adding the following subparagraphs:

vii.varying any or all of the time periods in Part XX, and

viii.prescribing manners of disseminating advertisements in accordance with subsection 100 (7).

(7)Paragraph 30 of subsection 143 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is repealed and the following substituted:

30.Prescribing time periods under section 107 of the Act or varying or providing for exemptions from any requirement of Part XXI (Insider Trading and Self-Dealing).

(8)Paragraph 31 of subsection 143 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 33, section 8, is amended by striking out ``and" at the end of subparagraph x, by adding ``and" at the end of subparagraph xi and by adding the following subparagraph:

xii.prescribing requirements in respect of, or in relation to, promoters, advisers or persons and companies who administer or participate in the administration of the affairs of mutual funds or non-redeemable investment funds.

(9)Subsection 143 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 33, section 8 and amended by 1997, chapter 19, section 23 and 1997, chapter 43, Schedule F, section 13, is further amended by striking out ``varying the application of", wherever it appears, and substituting in each case ``varying" and by adding the following paragraphs:

47.Regulating scholarship plans and the distribution and trading of the securities of scholarship plans.

48.Specifying the conditions under which any particular type of trade that would not otherwise be a distribution shall be a distribution.

49.Varying this Act to permit or require methods of filing or delivery, to or by the Commission, issuers, registrants, security holders or others, of documents, information, notices, books, records, things, reports, orders, authorizations or other communications required under or governed by Ontario securities laws.

50.Providing for exemptions from or varying the requirements set out in Part XIII.

51.Prescribing amounts for the purposes of paragraphs 5 and 18 of subsection 35 (1) and clauses 72 (1) (d) and (l).

52.Providing for exemptions from or varying the requirements under this Act in respect of amendments to prospectuses or preliminary prospectuses, or prescribing circumstances under which an amendment to a preliminary prospectus or prospectus must be filed.

53.Providing for exemptions from or varying the requirements of section 62, 65 or 71.

54.Providing for exemptions from or varying the requirements of subsections 72 (4), (5), (6) and (7).

55.Specifying exemptions and circumstances that shall be subject to section 130.1.

56.Prescribing, providing for exemptions from or varying any or all of the time periods in this Act.

221.The Act is amended by adding the following section:

Exchange of information

153.Despite the Freedom of Information and Protection of Privacy Act, the Commission may provide information to and receive information from other securities or financial regulatory authorities, stock exchanges, self-regulatory bodies or organizations, law enforcement agencies and other governmental or regulatory authorities, both in Canada and elsewhere, and any information so received by the Commission shall be exempt from disclosure under that Act if the Commission determines that the information should be maintained in confidence.

Commencement

222.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Sections 202, 211, 212 and 213 and subsection 220 (6) come into force on a day to be named by proclamation of the Lieutenant Governor.

Part xxii

Toronto Stock Exchange Act

and Complementary Amendments

Toronto Stock Exchange Act

223.(1)The first definition of section 1 of the Toronto Stock Exchange Act, as re-enacted by the Statutes of Ontario, 1997, chapter 19, section 26 is amended by inserting ``company" after ``associate" in the first line.

(2)The definition of ``board of directors" in section 1 of the Act is repealed and the following substituted:

``board of directors" means the board of directors of The Toronto Stock Exchange or of The Toronto Stock Exchange Inc., as the case may be; (``conseil d'administration")

(3)Section 1 of the Act, as amended by the Statutes of Ontario, 1997, chapter 19, section 26, is further amended by adding the following definition:

``continued Corporation" means The Toronto Stock Exchange as continued under the Business Corporations Act pursuant to Part II.1; (``Socit maintenue")

(4)The definition of ``exchange" in section 1 of the Act is repealed and the following substituted:

``exchange" means the exchange operated by the Corporation or by the continued Corporation, as the case may be; (``Bourse")

(5)Section 1 of the Act, as amended by the Statutes of Ontario, 1997, chapter 19, section 26, is further amended by adding the following definition:

``person", except in subsections 7 (2), (3) and (4) and 8 (3) and section 11, has the same meaning as in the Securities Act\; (``personne")

224.Part II of the Act is repealed.

225.The Act is amended by adding the following Part:

Part II.1

The Toronto Stock Exchange Inc.

Continuation of The Toronto Stock Exchange under Business Corporations Act

13.0.1(1)The Corporation may, if it obtains the approvals required by this section, apply to the Director under the Business Corporations Act to be continued under that Act.

Approval of members

(2)The members of the Corporation must by by-law approve the application for continuance and the terms of the continuance, including the terms on which shares of the continued Corporation are to be issued in connection with the continuance and the manner of determining the first directors of the continued Corporation.

Approval of Ontario Securities Commission

(3)The Ontario Securities Commission must approve the application for continuance and may attach terms and conditions to its approval as it considers appropriate.

Approval of Minister of Finance

(4)The Minister of Finance must approve the application for continuance.

Validity of approvals

(5)An approval that is required under this section is valid until the first anniversary of the last approval required under this section being obtained.

Same

(6)An approval that is required under this section is valid even if it was obtained before section 225 of the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 comes into force.

Articles of continuance

13.0.2(1)The Corporation's articles of continuance shall be sent to the Director under the Business Corporations Act, together with the certificate of an officer of the Corporation stating that the approvals required by section 13.0.1 have been obtained and are still valid.

Same

(2)The articles of continuance shall be in the form prescribed under the Business Corporations Act for the purpose of section 180 of that Act, with necessary modifications to reflect that the Corporation was not originally incorporated in a jurisdiction other than Ontario and is not required to comply with subsection 180 (3) of that Act.

Same

(3)The articles of continuance shall include any provisions necessary to make them conform to this Act and the laws of Ontario, and may include such other provisions as would be permitted in articles of incorporation under the Business Corporations Act for a corporation incorporated under that Act.

Endorsement of certificate of continuance

13.0.3(1)Upon receipt of the articles of continuance and other documents required under section 13.0.2, the Director under the Business Corporations Act shall endorse on the articles of continuance in accordance with section 273 of the Business Corporations Act a certificate which shall constitute the certificate of continuance.

Effect of certificate

(2)Upon the articles of continuance becoming effective,

(a)the Corporation becomes a corporation to which the Business Corporations Act applies as if it had been incorporated under that Act;

(b)the articles of continuance are deemed to be the articles of incorporation of the continued Corporation; and

(c)except for the purposes of subsection 117 (1) of the Business Corporations Act, the certificate of continuance is deemed to be the certificate of incorporation of the continued Corporation.

Rights, liabilities, etc., preserved

(3)Upon the Corporation being continued under the Business Corporations Act,

(a)the continued Corporation possesses all the property, rights, privileges and franchises and is subject to all the liabilities, including civil, criminal and quasi-criminal, and all contracts, disabilities and debts of the Corporation;

(b)a conviction against, or ruling, order or judgment in favour of or against the Corporation may be enforced by or against the continued Corporation;

(c)the continued Corporation shall be deemed to be the party plaintiff or the party defendant, as the case may be, in any civil action commenced by or against the Corporation; and

(d)the continued Corporation is a recognized stock exchange under the Securities Act and is subject to that Act and to any terms and conditions imposed under subsection 13.0.1 (3).

Name of continued Corporation

13.0.4(1)Despite section 9 of the Business Corporations Act, upon the articles of continuance becoming effective, the continued Corporation shall be known as The Toronto Stock Exchange Inc. in English and Bourse de Toronto Inc. in French.

Same

(2)The continued Corporation may subsequently change its name by articles of amendment under the Business Corporations Act.

Transition

(3)Any reference in a by-law, regulation, rule, authorization, order, direction, ruling, guideline, policy or other document under the Commodity Futures Act, Securities Act, Toronto Futures Exchange Act or any other Act to The Toronto Stock Exchange or to a by-law, ruling, policy, rule, regulation, order, direction or other document of The Toronto Stock Exchange shall be read, respectively, as a reference to The Toronto Stock Exchange Inc. or to a by-law, ruling, policy, rule, regulation, order or direction of The Toronto Stock Exchange Inc.

Existing members of Corporation

13.0.5(1)The rights of the members of the Corporation immediately before the articles of continuance become effective are extinguished upon the articles of continuance becoming effective.

Same

(2)A person or company who is a member of the Corporation immediately before the articles of continuance become effective shall not have any ownership or voting interest in the continued Corporation by virtue only of membership in the Corporation.

Membership in continued Corporation

(3)A person or company who is a member of the Corporation immediately before the articles of continuance become effective and any other person or company may, subject to the approval of the continued Corporation, execute a contract with the continued Corporation to become a member of the continued Corporation.

Same

(4)A person or company who is a member of the continued Corporation shall be bound by its contract with the continued Corporation but does not acquire any ownership or voting interest in the continued Corporation by virtue only of membership in the continued Corporation.

Liability of members

(5)A person or company who is a member of the continued Corporation shall not be liable for any act, default, obligation or liability of the continued Corporation by virtue only of membership in the continued Corporation.

First issue of shares

13.0.6(1)The continued Corporation shall, forthwith after the articles of continuance become effective, issue shares in accordance with the by-law of the Corporation described in subsection 13.0.1 (2).

First annual shareholders meeting

(2)The first annual meeting of shareholders of the continued Corporation shall be held not later than six months after the end of the financial year of the continued Corporation in which the articles of continuance became effective.

First directors of continued Corporation

13.0.7(1)The first directors of the continued Corporation shall be the individuals named in the articles of continuance.

Term of office of first directors

(2)The first directors of the continued Corporation shall hold office until the close of the first annual meeting of shareholders of the continued Corporation.

Powers of the board

13.0.8(1)The board of directors has the power to govern and regulate,

(a)the exchange;

(b)the partnership and corporate arrangements of the members of the continued Corporation and other persons or companies authorized to trade by the exchange, including requirements as to financial condition;

(c)the business conduct of members of the continued Corporation and other persons or companies authorized to trade by the exchange and of their current and former directors, officers, employees and agents and other persons or companies currently or formerly associated with them in the conduct of business, but only in respect of their business conduct while employed or associated with a member of the continued Corporation; and

(d)the business conduct of former members of the continued Corporation and other persons or companies formerly authorized to trade by the exchange and of their current and former directors, officers, employees and agents and other persons or companies currently or formerly associated with them in the conduct of business, but only in respect of their business conduct while a member of the continued Corporation or while employed or associated with a member of the continued Corporation.

By-laws, etc.

(2)In the exercise of the powers set out in subsection (1) and in addition to its power to pass by-laws under the Business Corporations Act, the board of directors may pass by-laws, make or adopt rulings, policies, rules and regulations and issue orders and directions as it considers necessary, including the imposition of penalties and forfeitures for the breach of any such by-law, ruling, policy, rule, regulation, order or direction.

Immediate restriction or suspension

(3)If the board of directors orders the restriction or suspension of the privileges of any person or company before a hearing of the matter is held, the order shall provide that the restriction or suspension shall be imposed only where the board of directors considers it necessary for the protection of the public interest and that the restriction or suspension shall expire 15 days after the date on which the order was made unless a hearing is held within that period of time to confirm or set aside the order.

Delegation of powers

(4)The board of directors may by order delegate to one or more persons, companies or committees the power of the board of directors,

(a)to consider, hold hearings and make determinations regarding applications for any acceptance, approval, registration or authorization and to impose terms and conditions on any such acceptance, approval, registration or authorization;

(b)to investigate and examine the business conduct of members of the continued Corporation, former members of the continued Corporation and other persons or companies referred to in clauses (1) (c) and (d); and

(c)to hold hearings, make determinations and discipline members of the continued Corporation, former members of the continued Corporation and other persons or companies referred to in clauses (1) (c) and (d) in matters related to business conduct.

Same

(5)A delegation made under subsection (4) may provide that it is subject to specified limitations, restrictions, conditions and requirements.

Transition

(6)Any by-laws or rulings made, policies, rules or regulations adopted and orders or directions issued by the Corporation under section 10 of this Act, as it reads on the day before the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent, continue in force, with necessary modifications, until amended or repealed or revoked by the continued Corporation.

Same

(7)Any consideration, hearing, investigation or examination begun under section 10 of this Act, as it reads on the day before the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999 receives Royal Assent, may be continued under this section and the continued Corporation stands in the place of the Corporation with respect to such matter.

Non-application of Part II

13.0.9Part II of the Act does not apply to the continued Corporation.

226.(1)Clause 13.2 (1) (b) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 26, is amended by inserting after ``persons" in the third and fourth lines ``or companies".

(2)Clause 13.2 (1) (c) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 26, is amended by inserting after ``persons" in the fourth line ``or companies".

(3)The French version of subsection 13.2 (3) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 26, is amended by striking out ``personne physique ou morale" in the fifth and sixth lines and substituting ``personne ou d'une compagnie".

(4)Subsection 13.2 (4) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 26, is amended by inserting after ``persons" in the second line ``companies".

(5)Clause 13.2 (4) (b) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 26, is amended by inserting after ``persons" in the third line ``or companies".

(6)Clause 13.2 (4) (c) of the Act, as enacted by the Statutes of Ontario, 1997, chapter 19, section 26, is amended by inserting after ``persons" in the third line ``or companies".

Toronto Futures Exchange Act

227.The definition of ``sponsor member" in section 1 of the Toronto Futures Exchange Act is amended by striking out ``The Toronto Stock Exchange" in the first and second lines and substituting ``The Toronto Stock Exchange Inc.".

228.(1)Clauses 8 (4) (c) and (d) of the Act are repealed and the following substituted:

(c)a member of The Toronto Stock Exchange Inc.; or

(d)an associate or insider of a member of The Toronto Stock Exchange Inc.

(2)Subsection 8 (5) of the Act is amended by striking out ``The Toronto Stock Exchange" at the end and substituting ``The Toronto Stock Exchange Inc.".

229.(1)Subsection 9 (2) of the Act is amended by striking out ``The Toronto Stock Exchange" at the end and substituting ``The Toronto Stock Exchange Inc.".

(2)Clauses 9 (3) (c) and (d) of the Act are revoked and the following substituted:

(c)a member of The Toronto Stock Exchange Inc.; or

(d)an associate or insider of a member of The Toronto Stock Exchange Inc.

Commencement

230.(1)Subject to subsection (2), this Part comes into force on the day this Act receives Royal Assent.

Same

(2)Sections 224, 227, 228 and 229 come into force on a day to be named by proclamation of the Lieutenant Governor.

Part xxiii

Commencement and Short Title

Commencement

231.(1)Subject to subsection (2), this Act comes into force on the day it receives Royal Assent.

Same

(2)Each Part of this Act comes into force as provided in the commencement section at the end of the Part.

Same

(3)If a Part of this Act provides that any provisions of it are to come into force on a day to be named by proclamation of the Lieutenant Governor, any such proclamation may apply to one or more of those provisions, and proclamations may be issued at different times with respect to any of those provisions.

Short title

232.The short title of this Act is the More Tax Cuts for Jobs, Growth and Prosperity Act, 1999.

[37] Bill 14 Original (PDF)