You are planning to operate an equity crowdfunding portal or a peer-to-peer lending platform? You are an issuer seeking to raise money through a portal or platform?

These activities are likely to trigger obligations under the Securities Act and its regulations.

Here is some guidance

Start-up crowdfunding

Regulation 45-110 respecting Start-up Crowdfunding Registration and Prospectus Exemptions (pdf - 141 KB)This link will open in a new windowUpdated on June 21, 2021Crowdfunding. (Regulation 45-110) is a harmonized pan-Canadian regulatory framework. It provides a framework for crowdfunding activities for start-ups and early-stage issuers.

Regulation 45-110 provides:

• an exemption from the prospectus requirement that allows an eligible issuer (see section 5 for the list of eligibility criteria) to distribute eligible securities (see below) through an online funding portal.
• an exemption from the dealer registration requirement for funding portals that facilitate online distributions by issuers relying on the start-up crowdfunding prospectus exemption.

The following securities are eligible for this regime:

• Common shares
• Preference shares
• Securities convertible into common shares or non-convertible preference shares
• Non-convertible debt securities linked to a fixed or floating interest rate
• Units of limited partnerships and
• Shares in the capital of an association
• The limit on aggregate proceeds raised by the issuer group (as defined in the regulation) during a 12-month period under the exemption is $1,500,000
• The exemption from the dealer registration requirement is subject to specific requirements (see Part 2 of the regulation for the list of requirements)
• A funding portal that is registered as an investment dealer or exempt market dealer may close a crowdfunding distribution on its platform provided it complies with certain requirements (see Part 3 of the regulation)

Refer to the Guide for Businesses (pdf - 484 KB)This link will open in a new windowUpdated on June 21, 2021Crowdfunding and the Guide for Funding Portals for more information about the regime introduced by Regulation 45-110.

Regulation 45-108 respecting Crowdfunding

The regime implemented by this regulation proposes a prospectus exemption for the distribution of securities of eligible crowdfunding issuers. However, it does not provide an exemption from the dealer registration requirement for funding portals.

Operation of marketplace lending platforms

Marketplace (peer-to-peer) lending platforms act as intermediaries, connecting borrowers and lenders. As such lending takes place outside the traditional banking system, which is riskier. The lending platform specifies the interest rates and terms of the loans offered (refer to the AMF's August 3, 2017 Notice relating to the operation of marketplace lending platforms (pdf - 41 KB)This link will open in a new windowUpdated on August 3, 2017"Notice, operation of marketplace, lending platforms").

• In Québec, there is no regulation dedicated to peer-to-peer lending platforms. However, such platforms are generally subject to requirements under some of the laws administered by the AMF, including the Securities Act This link will open in a new window
• On-line lending platforms usually carry on activities as intermediaries and thereby act as securities dealers or advisers. They are therefore required to register with the AMF and comply with the regulatory requirements applicable to registrants
• On-line lending platforms that distribute securities to investors must also comply with the prospectus requirement or benefit from a prospectus exemption

Visit the Crowdfunding section for more information about these crowdfunding regimes.

You are planning to operate a platform offering investment advice on-line, such as a robot-adviser or an automated adviser?

Firms with business models that rely on artificial intelligence (AI) to carry out transactions or make investment recommendations may need to register as securities advisers with the AMF.

For guidance on ways you can provide advice using an on-line platform while complying with regulatory requirements, consult CSA Staff Notice 31-342 Guidance for Portfolio Managers Regarding Online Advice (pdf - 82 KB)This link will open in a new windowUpdated on September 24, 2015Online Advice.

Visit the Securites section

You are offering technological solutions (AI, blockchain technology, etc.) to individuals or firms subject to AMF oversight?

This does not necessarily exempt you from the requirement to register with the AMF. If the services you are offering are a substitute for activities reserved for registered entities, you may have to register.

You want to offer a mobile payment solution (i.e., a way to transfer funds or pay invoices via a smart phone or other mobile device)?

The Money-Services Business Act This link will open in a new window governs funds transfers, i.e., movements of cash funds from one location to another or one person to another via a person, an entity or a network.

If you offer this type a service for remuneration (in the form of a per transaction fee or a fixed amount—a subscription, for example—providing access to numerous services offered via the same mobile solution), please refer to the web page Money-services businesses | Revenu QuébecThis link will open in a new window (MSBs). Please also refer to the web page Financial Transactions and Reports Analysis Centre of Canada This link will open in a new window (FINTRAC).

You want to:

• Offer insurance products over the Internet?
• Offer mortgage brokerage services over the Internet?
• Offer claims settlement services over the Internet?
• Offer financial planning services over the Internet?

You may have to register in order to comply with the Act respecting the distribution of financial products and services This link will open in a new window in one of the sectors it governs: insurance, claims settlements, mortgage brokerage or financial planning.

Visit the Products and services offered via the Internet