Bank Act (S.C. 1991, c. 46)

Marginal note:Borrowing from the public

• 520.1 (1) A foreign bank — or an entity that is associated with a foreign bank and that is incorporated or formed otherwise than by or under an Act of Parliament or of the legislature of a province — may, as part of its business in Canada, borrow money in Canada from the public only if

  • (a) it maintains a branch in Canada as permitted by section 522.05 or 522.19 or it engages in or carries on business in Canada as permitted by that section; and

  • (b) it discloses that

    • (i) it is not a member institution of the Canada Deposit Insurance Corporation,

    • (ii) the liability incurred through the borrowing is not a deposit, and

    • (iii) it is not regulated as a financial institution in Canada.

• Marginal note:Manner of disclosure

  (2) The disclosure must be

  • (a) in a prospectus, information circular or other offering document or a similar document related to the borrowing or, if there is no such document, in a statement delivered to the lender; or

  • (b) in any other manner that may be prescribed.

• Marginal note:Exception for certain borrowing

  (3) The disclosure is not required in respect of

  • (a) a borrowing of a prescribed class or type or a borrowing in prescribed circumstances or in a prescribed manner; or

  • (b) except as may be provided in any regulations, a borrowing

    • (i) from a person in an amount of $150,000 or more, or

    • (ii) through the issue of instruments in denominations of $150,000 or more.

• Marginal note:Exception

  (4) Subsection (1) does not apply to

  • (a) an authorized foreign bank;

  • (b) a foreign cooperative credit society that has received the approval of the Minister under paragraph 522.22(1)(f) to engage in or carry on the business of a cooperative credit society;

  • (c) a foreign insurance company;

  • (d) a foreign securities dealer that has received the approval of the Minister under paragraph 522.22(1)(f); or

  • (e) a prescribed entity.

Marginal note:Regulations

521 The Governor in Council may make regulations exempting any class or classes of businesses, investments, activities and branches from any of the prohibitions set out in section 510 or 518.

Marginal note:Permitted Canadian offices

522 A foreign bank may

• (a) with the approval of the Superintendent and

  • (i) subject to any terms and conditions that are attached to the approval, and

  • (ii) subject to and in accordance with rules that are prescribed in relation to the operation of representative offices and the conduct of their personnel,

  maintain representative offices in Canada that are registered with the Superintendent in the prescribed manner; and

• (b) with the approval of the Governor in Council and subject to any terms and conditions that are attached to the approval, locate its head office in Canada and, from that office, issue directions and do all other things reasonably necessary for the conduct of its banking business outside Canada.

Marginal note:Examination of representative offices

• 522.01 (1) The Superintendent shall, from time to time, make or cause to be made any examination and inquiry into the operation of any representative office of a foreign bank and the conduct of the personnel in that office that the Superintendent considers necessary for the purpose of ascertaining whether the office is being operated, and whether the personnel of the office are conducting themselves, in accordance with the rules prescribed for the purposes of paragraph 522(a).

• Marginal note:Powers of Superintendent

  (2) For the purposes of subsection (1), the Superintendent and any person acting under the direction of the Superintendent have the same powers and obligations that the Superintendent has in relation to the examination of banks under this Act.

Marginal note:Name of representative office

522.011 If the name under which a representative office of a foreign bank is or will be identifying itself in Canada is one referred to in any of paragraphs 530(1)(a) to (e), the Superintendent may, as the case may be,

• (a) refuse to grant the approval referred to in paragraph 522(a);

• (b) impose restrictions on the use of the name in Canada; or

• (c) direct the foreign bank to change the name.

Marginal note:Cancellation of registration

522.02 The Superintendent may cancel the registration of a representative office of a foreign bank if

• (a) the foreign bank requests the Superintendent to cancel the registration;

• (b) the Superintendent is of the opinion that the representative office is not being operated, or the personnel of that office are not conducting themselves, in accordance with the rules prescribed for the purposes of paragraph 522(a); or

• (c) the Superintendent is of the opinion that the foreign bank has failed to comply with a restriction imposed under paragraph 522.011(b) or a direction made under paragraph 522.011(c).

Marginal note:Business conducted from head office in Canada

• 522.03 (1) Subject to subsections (2) and (3), if the head office of a foreign bank is located in Canada under paragraph 522(b), the foreign bank shall not conduct any business from that office with persons resident in Canada or with Her Majesty in right of Canada or a province except for the purpose of acquiring premises, supplies, services and staff for that office.

• Marginal note:Exception

  (2) If a foreign bank, immediately before the establishment of its head office in Canada under paragraph 522(b), held deposits of, or had loans outstanding to, persons resident in Canada or Her Majesty in right of Canada or a province, the foreign bank may repay those deposits and collect those loans through the head office in Canada.

• Marginal note:Exception

  (3) If a foreign bank controlled a bank or was a major shareholder of a bank immediately before the establishment of the foreign bank’s head office in Canada under paragraph 522(b), the foreign bank may continue to carry out from the head office in Canada any activities that were carried out from the head office of the foreign bank in relation to the bank before the establishment of the head office in Canada.

DIVISION 3No Financial Establishment in Canada

Marginal note:Permitted investment — foreign bank

• 522.04 (1) A foreign bank that does not have a financial establishment in Canada may acquire or hold control of, or a substantial investment in, a Canadian entity, so long as, by virtue of the acquisition, neither the foreign bank nor any entity associated with the foreign bank controls or becomes a major owner of

  • (a) a Canadian entity referred to in any of paragraphs 468(1)(a) to (i); or

  • (b) a Canadian entity that is a financial services entity.

• Marginal note:Permitted investment — associated entity

  (2) An entity that is associated with a foreign bank and that does not have a financial establishment in Canada may acquire or hold control of, or a substantial investment in, a Canadian entity, so long as, by virtue of the acquisition, neither the entity nor the foreign bank, nor any other entity associated with the foreign bank, controls or becomes a major owner of

  • (a) a Canadian entity referred to in any of paragraphs 468(1)(a) to (i); or

  • (b) a Canadian entity that is a financial services entity.