CSA OSC Early-Stage Capital Initiatives


On May 9, CSA OSC issued initiatives for early-stage business capital.


  • CSA OSC kicked off initiatives to enhance access to capital for early-stage businesses.
  • Includes NI 32-508, a dealer registration exemption for not-for-profit angel investor groups; NI 32-509, a dealer registration exemption for eligible early-stage businesses.
  • NI 45-509, extension of self-certified investor prospectus exemption, see #151634.
  • CSA OSC also published notice of general orders and FAQ in regards to NI 32-508.
  • Initiatives
  • Time-limited orders intended to further support early-stage capital raising in Ontario.
  • NI 32-508 provides that a not-for-profit angel investor group is exempt from requirement to be registered as dealer when trading in early-stage business securities.
  • Sets out activities that Ontario-based angel investor groups are allowed to engage in.
  • Not-for-profit angel investor groups will also be permitted to collect transaction-based compensation limited to a maximum of 5% of the value of the securities invested.
  • NI 32-509 provides that an early-stage business with its head office and business operations in Ontario is exempt from the requirement to be registered as a dealer.
  • Allows such business to raise aggregate funds of up to $3mn, among other provisions.
  • NI 45-509 provides exemption from self-certified investor prospectus exemption class order, provided issuer reports distributions on a quarterly basis using Form 45-509F1.
  • OSC TestLab
  • Early-stage capital exemptions, along with the self-certified investor prospectus exemption class order, are being introduced as part of the OSC TestLab program.
  • OSC TestLab program uses testing to evaluate capital market innovations regulation.
  • Initiatives are time-limited and enhance early-stage capital, with investor protections.
  • CSA OSC will be collecting data on the use of the exemptions through required forms.
  • Information will help evaluate initiatives and will invite perspectives from stakeholders.
  • Effectiveness
  • The Early-stage capital exemptions each come into effect on May 9, 2024.
  • NI 32-508 and NI 32-509 each remain in effect until Oct. 25, 2025, unless extended.
  • Extension of self-certified investor prospectus exemption (NI 45-509) remains in effect until the earlier of Oct. 25, 2025 or until effective date of an amendment to NI 45-106.

Regulators CSA; CSA OSC
Entity Types B/D; Corp; Inv Co
Reference PR, Nt, FAQ, 5/9/2024; Form 45-509F1; Citation: NI 32-508; NI 32-509; NI 45-509;
Functions Compliance; Legal; Operations; Product Design; Registration/Licensing; Reporting
Countries Canada
Category National Regulator ; State Regulator
State Ontario
Products Corporate; Fund Mgt; Securities
Regions Am
Rule Type Final
Rule Date 5/9/2024
Effective Date 5/9/2024
Rule Id 211586
Linked to N/A
Reg. Last Update 5/9/2024
Report Section International

Last substantive update on 05/14/2024