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Notice 2021-003 - Guidance – Investor Relations and Promotional Activity

July 12, 2021

The Canadian Securities Exchange (CSE, or Exchange) is issuing this notice to provide guidance and clarify the expectations with respect to disclosure of investor relations and promotional activity by or on behalf of Listed Issuers.

Exchange Requirements

CSE defines “significant transaction” as any corporate transaction, not involving equity securities, that constitutes material information concerning the Listed Issuer.  CSE Policy 7 – Significant Transactions and Developments (“Policy 7”) specifically describes as a significant transaction:

s. 1.1(d) “entering into any oral or written contract for Investor Relations Activities relating to the Listed Issuer by the Listed Issuer or by any other person of which the Listed Issuer has knowledge

Entering into such an agreement is therefore material and the Listed Issuer must disseminate a news release pursuant to Policy 5 – Timely Disclosure and Posting Requirements (“Policy 5”). 

In addition to the news release, Policy 7 requires that Listed Issuers must post Form 10 – Notice of Proposed Significant Transaction concurrently or as soon as practicable following the issuance of the news release announcing the significant transaction, and at least one full Business Day prior to the closing of a proposed significant transaction the Listed Issuer must post an initial or amended Form 10, if applicable.

Additional Reference

On November 29, 2018, the Canadian Securities Administrators published CSA Staff Notice 51-356 Problematic Promotional Activities by issuers in response to concerns about promotional activity by certain issuers.

Proposed Policy Amendments

The Exchange will be publishing, in the context of more comprehensive CSE Policy amendments, specific changes to Policy 7 including changes that are consistent with proposed BC Instrument 51-519 Promotional Activity Disclosure Requirements (the “BC Instrument”)

CSE will introduce a definition of “Promotional Activity” as defined in the Securities Act (BC).

"promotional activity" means any activity, including, for greater certainty, any oral or written communication, that by itself or together with one or more other activities encourages or reasonably could be expected to encourage a person

(a)   to purchase, not purchase, trade or not trade a security, or

(b)   to trade or not trade a derivative,

but does not include an activity prescribed for the purpose of this definition.


The proposed changes to Policy 7 will include:


  • Except as provided below, compensation in the form of shares is not acceptable and payment for services should be on a cash basis.
  • If permitted by securities laws, options may be granted for persons undertaking Investor Relations activities provided that the total number of listed securities issuable on exercise of options) provided as compensation to all Persons providing Investor Relations Activities cannot exceed 2% of the outstanding number of listed securities in any 12-month period.

Additional requirements to Policy 7 will include:


In addition to the Form 10, a Listed Issuer that arranges for a Person to conduct Promotional Activity, including Investor Relations activity, in respect of the Listed Issuer or a security of the Listed Issuer must promptly disseminate a news release disclosing the following:

a. that the Listed Issuer has arranged for the Person to conduct the Promotional Activity;

b. the name, business address, email and telephone number of each person or company that will be involved in conducting the Promotional Activity, and a description of the Person’s relationship with the issuer, if any;

c. the date on which the Promotional Activity will start and the date on which the promotional activity will end or is expected to end;

d. the nature of the Promotional Activity;

e. any platform or other medium on or through which the Promotional Activity will occur; and

f. a description of the compensation that the Person has received or may receive for the Promotional Activity including, the total amount of the compensation and whether the compensation includes options to purchase securities of the Listed Issuer.

Suitability Considerations

Further to s. 2.18 of Policy 2, the Exchange may deem any Person to be unacceptable to be associated in any manner with a Listed Issuer if that Person has made or accepted excessive payments for Promotional Activity or Investor Relations activities or been associated with or failed to prevent the production, approval, or distribution of overly promotional materials on behalf of, or with respect to the securities of, any reporting issuer.


Form 10 sets out specific questions and requires details “sufficiently complete to enable a reader to appreciate the significance of the transaction without reference to any other material.”  The intent of the current CSE Policy and Form 10 are consistent with the disclosure requirements in the proposed BC Instrument and the pending CSE Policy amendments (together, “Proposed Standards”).

The Exchange expects the news release and Form 10 disclosure by Listed Issuers to reflect the Proposed Standards and will consider inadequate disclosure to be a breach of Exchange requirements.

The pending CSE Policy amendments will be published for comment and remain subject to the approval of the BCSC and OSC.  The guidance set out in this notice is effective immediately.

For questions about CSE Listings Policies or procedures, please contact:

[email protected], or 416-367-7340.

Mark Faulkner, Vice President Listings & Regulation

[email protected]