The regulator spelled out the fine print on prospectus-free raises up to $50 million
Canada's securities regulators have updated their guidance on a prospectus exemption that lets listed companies raise up to $50 million without a prospectus.
The Canadian Securities Administrators on July 23, 2026 published a revised version of Staff Notice 45-330, a set of frequently asked questions about the listed issuer financing exemption. The exemption, adopted across the country in November 2022 under Part 5A of National Instrument 45-106, gives reporting issuers with securities on a recognized Canadian exchange a way to raise money by distributing securities to investors - and the shares it produces are freely tradeable, without the hold period that attaches to many other prospectus exemptions.
For the dealers and advisors who take part in these financings, the mechanics matter. On its own, the exemption lets an issuer raise the greater of $5 million and 10 percent of its market capitalization, to a ceiling of $10 million over any 12-month period. A blanket order the regulators issued on May 14, 2025 - Coordinated Blanket Order 45-935 - lifts those figures for issuers that opt in, allowing the greater of $25 million and 20 percent of the market value of listed securities, up to $50 million. Issuers that use the blanket order face different terms tied to a 50 percent dilution limit.
The revised notice also maps where the exemption stops. An issuer in default of securities legislation cannot use it. An issuer must actually hold listed equity securities at the time of the distribution; a listing that closes alongside or after the offering does not qualify. And the issuer must reasonably expect to have enough money to meet its business objectives and liquidity needs for the 12 months after closing, which in most cases means setting a minimum offering amount.
The regulators also underline investor protection. If a completed offering document contains a misrepresentation, purchasers may rescind the purchase or seek damages against the issuer, and in certain jurisdictions may seek damages from the directors and the officers who signed the document.
Other answers speak to how deals actually get done. An offering can close in multiple tranches, though any required minimum must come in the first tranche and the last tranche must close no later than the 45th day after the announcing news release. Issuers may pair the exemption with other prospectus exemptions. But staff say the exemption is not available for securities issued for debt, does not typically extend to broker's warrants, and cannot be used for sharing arrangements where the proceeds sit in escrow. The notice flags backdoor underwriting concerns when a dealer picks up securities, and cautions that bought deals can run into trouble if solicitation happens before the news release and offering document are filed.
The full text of CSA Staff Notice 45-330 (Revised) is available at https://www.osc.ca/sites/default/files/2026-07/csa_20260723_45-330_notice-revised-faq.pdf.
