An Act to establish the Canada Deposit Insurance CorporationCanada Deposit Insurance Corporation ActCanada Deposit Insurance Corporation20257
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C-3Short Title
Short titleThis Act may be cited as the Canada Deposit Insurance Corporation Act.R.S., c. C-3, s. 1
Interpretation
DefinitionsIn this Act,affairs, with respect to a member institution, means its business and the relationships among the member institution and its affiliates and the shareholders, directors and officers of the member institution and its affiliates; (affaires internes)affiliate, in respect of a member institution that isa bank, means an entity that is affiliated with the bank within the meaning of the Bank Act, orother than a bank, means an entity that would be affiliated with the member institution within the meaning of the Bank Act if the member institution were a bank to which that Act applies; (groupe)appropriate provincial minister, in relation to a provincial institution, means the minister of the Crown of the province of incorporation of the institution responsible for the supervision of the provincial institution; (ministre provincial compétent)bank means a bank listed in Schedule I or II to the Bank Act; (banque)Board means the Board of Directors of the Corporation; (conseil)bridge institution means a federal institution that is designated as a bridge institution by an order made under paragraph 39.13(1)(c); (institution-relais)by-laws means the by-laws of the Corporation; (règlements administratifs)Chairman[Repealed, 1996, c. 6, s. 21]Chairperson means the Chairperson of the Board; (président)Corporation means the Canada Deposit Insurance Corporation established by section 3; (Société)deposit and depositor mean respectively a deposit and a depositor as defined in the schedule; (dépôt et déposant)deposit insurance means the insurance referred to in paragraph 7(a); (assurance-dépôts)domestic systemically important bank has the same meaning as in section 2 of the Bank Act; (banque d’importance systémique nationale)federal credit union has the same meaning as in section 2 of the Bank Act; (coopérative de crédit fédérale)federal institution means a bank, company or association referred to in section 8; (institution fédérale)federal member institution means a federal institution that is a member institution; (institution fédérale membre)local cooperative credit society has the same meaning as in section 2 of the Bank Act; (société coopérative de crédit locale)member institution means a corporation that has deposit insurance under this Act; (institution membre)Minister means the Minister of Finance; (ministre)nominee broker means a person who is a party to an agreement or arrangement with a member institution in order to make deposits as a nominee on behalf of another person; (courtier-fiduciaire)nominee broker deposit means a deposit made at a member institution by a nominee broker acting as a nominee on behalf of another person; (dépôt de courtier-fiduciaire)policy of deposit insurance or policy means the instrument evidencing the deposit insurance of a member institution; (police d’assurance-dépôts ou police)premium year means, in relation to the calculation and payment of premiums pursuant to this Act, the period beginning on May 1 in one year and ending on April 30 in the next year; (exercice comptable des primes)professional trustee means any of the following who is not a nominee broker:the public trustee of a province or a similar public official whose duties involve holding moneys in trust for others;a federal, provincial or municipal government, or a department or agency of such a government;a lawyer or partnership of lawyers, a law corporation, or a notary or partnership of notaries in the province of Quebec, when they act in that capacity as a trustee of moneys for others;a person who is acting as a trustee of moneys for others in the course of business and is required by or under a statute to hold the deposit in trust;a person who is acting as a trustee of moneys for others in the course of business and is subject to the rules of a securities commission, stock exchange or other regulatory or self-regulating organization that audits compliance with those rules; ora regulated federal or provincial trust company acting in the capacity of a depositor; (fiduciaire professionnel)provincial institution means a company referred to in section 9; (institution provinciale)provincial member institution means a provincial institution that is a member institution; (institution provinciale membre)provincial supervisor, in relation to a provincial institution, means the official of the province of incorporation of the provincial institution who supervises the affairs of the provincial institution; (contrôleur provincial)receiver includes a receiver-manager and a sequestrator; (séquestre)representation means any oral or written statement and includes any advertisement and any mark, sign, trade name or other device; (déclaration)returned payment means any portion of a payment made by the Corporation under subsection 14(2) or (2.1) that is either returned to the Corporation or that otherwise remains under its control; (paiement retourné)share includesa conversion or exchange privilege, issued by a member institution, that is convertible at any time into a share,an option or a right, issued by a member institution, to acquire a share or a privilege referred to in paragraph (a), anda membership share within the meaning of section 2 of the Bank Act; (action)shareholder includes the holder of a membership share of a federal credit union; (actionnaire)subordinated debt means debt of a member institution that, by the terms of any instrument evidencing the debt, will, in the event of the insolvency or winding-up of the member institution, be subordinate in right of payment to all deposit liabilities of the member institution and all other liabilities of the member institution except those that, by their terms, rank equally with or are subordinate to that debt and includesa conversion or exchange privilege that is convertible at any time into subordinated debt, andan option or a right to acquire subordinated debt or a privilege referred to in paragraph (a)issued by a member institution; (dette subordonnée)Superintendent means the Superintendent of Financial Institutions appointed pursuant to subsection 5(1) of the Office of the Superintendent of Financial Institutions Act. (surintendant)R.S., 1985, c. C-3, s. 2; R.S., 1985, c. 18 (3rd Supp.), s. 47; 1992, c. 1, s. 142, c. 26, s. 1; 1996, c. 6, s. 21; 1999, c. 28, s. 98; 2001, c. 9, s. 203; 2009, c. 2, s. 233; 2010, c. 12, s. 2094; 2012, c. 5, s. 185; 2016, c. 7, s. 1262018, c. 12, s. 202
Her Majesty
Binding on Her MajestyThis Act is binding on Her Majesty in right of Canada or a province.1992, c. 26, s. 2
Powers, Etc., of Minister
DelegationThe Minister may delegate any of the Minister’s powers, duties and functions under this Act to any Minister of State appointed pursuant to the Ministries and Ministers of State Act to assist the Minister.1996, c. 6, s. 21.1
Constitution of the Corporation
Corporation establishedThere is hereby established a corporation, to be called the Canada Deposit Insurance Corporation.Agent of Her MajestyThe Corporation is, for all purposes of this Act, an agent of Her Majesty in right of Canada.R.S., c. C-3, s. 3; 1984, c. 31, s. 14
Head officeThe head office of the Corporation shall be at the city of Ottawa.Offices and agentsThe Corporation may establish offices or employ agents in any part of Canada.R.S., c. C-3, s. 4
Board of DirectorsThere shall be a Board of Directors of the Corporation consisting ofthe person appointed as the Chairperson under subsection 6(1);the person appointed as the President and Chief Executive Officer of the Corporation under subsection 105(5) of the Financial Administration Act;the persons who for the time being hold the offices of the Governor of the Bank of Canada, the Deputy Minister of Finance, the Superintendent of Financial Institutions and the Commissioner of the Financial Consumer Agency of Canada;a Deputy Superintendent of Financial Institutions, or an officer of the Office of the Superintendent of Financial Institutions, appointed by the Minister; andnot more than six other members appointed by the Minister with the approval of the Governor in Council.DisqualificationsA person is not eligible to be appointed under paragraph (1)(c) or, having been appointed under that paragraph, to continue as a member of the Board, if the person isemployed in any capacity in the federal public administration or holds any office or position for which any salary or other remuneration is payable out of public moneys;a member of the Senate or House of Commons of Canada or a member of a provincial legislature; ora director, officer or employee of a federal institution, a provincial institution or a local cooperative credit society.Alternate directorA director referred to in paragraph (1)(b) may, from time to time with the approval of the Minister, designate in writing an alternate to attend in the director’s absence at any meeting of the Board of Directors, and the alternate shall be deemed to be a member of the Board while so attending a meeting of the Board.VacancyA vacancy on the Board does not impair the right of the remaining directors to act.Acting chairpersonWhere the office of Chairperson is vacant, the Minister may appoint, for a period not exceeding ninety days, an acting Chairperson who shall, while so acting, be a member of the Board and have all the powers of the Chairperson.Expenses of directorsA director shall be paid by the Corporation reasonable travel and living expenses incurred by the director while absent from his or her ordinary place of residence in the course of his or her duties as a director but no director referred to in paragraph (1)(b) shall receive any other remuneration for his or her services on the Board.Remuneration of certain directorsA director referred to in paragraph (1)(c) shall be paid by the Corporation for attendance at meetings of the Board such remuneration as may be fixed by the Governor in Council.R.S., 1985, c. C-3, s. 5; R.S., 1985, c. 18 (2nd Supp.), s. 1, c. 18 (3rd Supp.), s. 48; 1996, c. 6, s. 47(E); 2001, c. 9, s. 204; 2003, c. 22, s. 224(E); 2010, c. 12, s. 2095; 2012, c. 5, s. 206(E)2022, c. 10, s. 181
ChairpersonThe Governor in Council shall appoint a person of proven financial ability to be Chairperson of the Board.Term of officeNotwithstanding subsection 105(5) of the Financial Administration Act, the Chairperson shall be appointed to hold office during good behaviour for such term as the Governor in Council deems appropriate but may be reappointed on the expiration of his or her term of office and may be removed at any time by the Governor in Council for cause.DisqualificationNo person is eligible to be appointed or to continue as Chairperson whois not a Canadian citizen ordinarily resident in Canada;is a member of the Senate or House of Commons or a member of a provincial legislature; oris a director, officer or employee of a federal institution, a provincial institution or a local cooperative credit society.[Repealed, 2007, c. 6, s. 402]Presiding at meetingsThe Chairperson shall preside at all meetings of the Board but where at any meeting the Chairperson is absent, one of the directors present thereat who is chosen so to act by the directors present shall preside and have all the powers of the Chairperson.Remuneration of ChairpersonThe Chairperson shall be paid by the Corporation such remuneration as may be fixed by the Governor in Council.R.S., 1985, c. C-3, s. 6; 1996, c. 6, s. 47(E); 2007, c. 6, s. 402; 2010, c. 12, s. 2096; 2012, c. 5, s. 206(E)
Objects, Powers and Duties
ObjectsThe objects of the Corporation areto provide insurance against the loss of part or all of deposits;to promote and otherwise contribute to the stability of the financial system in Canada;to pursue the objects set out in paragraphs (a) and (b) for the benefit of persons having deposits with member institutions and in such manner as will minimize the exposure of the Corporation to loss; andto act as the resolution authority for its members.R.S., 1985, c. C-3, s. 7; R.S., 1985, c. 18 (3rd Supp.), s. 49; 1996, c. 6, s. 22; 2005, c. 30, s. 98; 2017, c. 20, s. 108
Power of Governor in CouncilThe Governor in Council may, by order, exempt the Corporation from the requirement that it pursue its objects in a manner that will minimize its exposure to loss when it takes any action to address a situation that is specified in the order.Condition precedentThe Governor in Council may make the order only if the Minister is of the opinion, after consultation with the Board, the Governor of the Bank of Canada and the Superintendent, that the requirement that the Corporation pursue its objects in a manner that will minimize its exposure to loss, in respect of a situation that will be specified in the order, might have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.RepealThe Governor in Council may repeal the order only if the Minister is of the opinion that the requirement that the Corporation pursue its objects in a manner that will minimize its exposure to loss, in respect of the situation specified in the order, will no longer have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.2009, c. 2, s. 234
Coming into forceAn order made under subsection 7.1(1) has effect from the time that it is made.Statutory Instruments ActThe Statutory Instruments Act does not apply to the order.PublicationThe Minister shall cause a notice to be published in the Canada Gazette that the order has been made or repealed as soon as the Minister is of the opinion that the publication of the notice will not have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.2009, c. 2, s. 234
Recovery of lossAfter the publication of a notice in the Canada Gazette that an order was made under subsection 7.1(1), the Corporation shall, in accordance with its by-laws, collect a special premium from member institutions or any class of member institutions in order to recover the loss that the Corporation determines it incurred as a result of pursuing its objects without regard to the requirement that it do so in a manner that minimizes its exposure to loss.2009, c. 2, s. 234
Federal institutionsFor the purposes of this Act, the following are federal institutions:a bank;a company to which the Trust and Loan Companies Act applies; anda retail association within the meaning of regulations made under the Cooperative Credit Associations Act.R.S., 1985, c. C-3, s. 8; 1991, c. 45, s. 541; 1999, c. 28, s. 99; 2001, c. 9, s. 205; 2005, c. 30, s. 99
Provincial institutionsFor the purposes of this Act, an incorporated company that carries on, under an Act of the legislature of a province or a constating instrument under provincial jurisdiction, a business substantially similar to the business of a company to which the Trust and Loan Companies Act applies and that is authorized by or under an Act of the legislature of a province to accept deposits from the public is a provincial institution.R.S., 1985, c. C-3, s. 9; 1991, c. 45, s. 542
Powers of CorporationThe Corporation may do all things necessary or incidental to the objects of the Corporation and in particular, but without limiting the generality of the foregoing, the Corporation may, in furtherance of its objects,acquire assets from a member institution;make or guarantee loans or advances, with or without security, to a member institution;make or guarantee a deposit with a member institution;assume liabilities of a member institution;enter into an agreement with the government of a province, or an agent of the government of a province, respecting any matter relating to the insurance of deposits with provincial institutions in that province;make any investment and enter into any transaction necessary or desirable for the financial management of the Corporation;act as liquidator, receiver or inspector of a member institution or a subsidiary thereof, when duly appointed as such and appoint qualified and competent persons, whether employees of the Corporation or not, to carry out any or all of the functions of the Corporation under the appointment of the Corporation;assume the costs of a winding-up of a member institution when the Corporation is appointed to act as a liquidator in the winding-up, or assume the costs of the receiver when the Corporation is appointed to act as such;guarantee the payment of the fees of, and the costs incurred by any person as, the liquidator or receiver of a member institution when that person is appointed as such;acquire assets and assume liabilities of a member institution from its liquidator or receiver;acquire, by way of security or otherwise, shares and subordinated debt of a member institution and to hold and dispose of those shares and subordinated debt;make an advance for the purpose of paying a claim, against a member institution for which the Corporation is acting as receiver or liquidator, in respect of any insured deposit and of becoming subrogated as an unsecured creditor for the amount of the advance;make or cause to be made such inspections of a member institution as may be authorized under this Act or a policy of deposit insurance;acquire, hold and alienate real and personal property;settle or compromise any claim by or against the Corporation; anddo all such other things as may be necessary for the exercising of any power of the Corporation.Subsidiary corporationsFor the purposes of facilitating the acquisition, management or disposal of real property or other assets of a member institution that the Corporation may acquire as the result of its operations, the Corporation may, when authorized by order of the Governor in Council,procure the incorporation of a corporation, all the shares of which, on incorporation, would be held by, on behalf of or in trust for the Corporation; oracquire all of the shares of a corporation that, on acquisition, would be held by, on behalf of or in trust for the Corporation.Subsidiary not an agentA corporation described in paragraph (2)(a) or (b) is deemed not to be an agent of the Corporation or of Her Majesty in right of Canada.Assets and liabilitiesA corporation described in paragraph (2)(a) or (b) may acquire assets and assume liabilities of a member institution from that institution or from its liquidator or receiver.Conditions applicable to the exercise of certain powersThe Corporation shall, in exercising its powers under paragraph (1)(b), comply with such directions of general application as the Minister may, in writing, give to the Corporation.R.S., 1985, c. C-3, s. 10; R.S., 1985, c. 18 (3rd Supp.), s. 50; 1992, c. 26, s. 3; 1996, c. 6, s. 23; 2001, c. 9, s. 206; 2016, c. 7, s. 127; 2018, c. 27, s. 157
For greater certainty — deposit insurance contractsFor greater certainty, the Corporation may administer any contract related to deposit insurance that the Minister enters into with any entity under section 60.2 of the Financial Administration Act.2023, c. 26, s. 625
Exemption — shares of member institutionTo enable the Corporation to acquire, hold or dispose of shares under paragraph 10(1)(f.1), the Minister may, by order, exempt any person or share specified in the order from any of the following provisions:sections 47.03, 47.04, 47.06, 47.09, 47.11, 47.15, 47.17, 47.18 and 60.1, subsection 79.2(1) and sections 372, 373, 374, 375, 376, 376.1, 376.2, 377, 377.1, 377.2  379, 382.1, 385, 401.11, 401.2 and 401.3 of the Bank Act;sections 407, 407.01, 407.02, 407.03, 407.1, 407.2, 408, 411, 428 and 430 of the Insurance Companies Act; andsections 375, 375.1, 376, 379, 396 and 399 of the Trust and Loan Companies Act.ConditionsThe exemption may be subject to conditions.Duration of exemptionThe exemption ceases to have effect five years after the day on which it comes into force.ExtensionThe Minister may, by order, extend the duration of the exemption if general market conditions so warrant.Statutory Instruments ActThe Statutory Instruments Act does not apply to an order made under this section.2009, c. 2, s. 235; 2010, c. 12, s. 2097
Loans to CorporationAt the request of the Corporation, the Minister may, out of the Consolidated Revenue Fund, lend money to the Corporation on such terms and conditions as the Minister may establish.Other borrowingThe Corporation may borrow money otherwise than under subsection (1) and may borrow by any means, including the issuance and sale of bonds, debentures, notes or any other evidence of indebtedness.Total indebtednessThe total principal indebtedness outstanding at any time in respect of borrowings by the Corporation under subsections (1) and (2), excluding the borrowings under paragraph 60.2(2)(c) of the Financial Administration Act and under subparagraph 60.2(2)(a)(iii) of that Act as it read on September 30, 2020, shall not exceed$15,000,000,000 or, if it is greater, the amount determined in accordance with subsections (3.1) to (3.5); orsuch greater amount as may be authorized for the purposes of this subsection by Parliament under an appropriation Act.IncreaseSubject to subsections (3.3) and (3.4), the amount that the total principal indebtedness outstanding at any time in respect of borrowings under subsections (1) and (2) shall not exceed is increased each year to the amount determined by the formulaA + (A × B)whereAis $15,000,000,000; andBis the rate determined by the formula set out in subsection (3.2).RateThe rate referred to in the description of B in subsection (3.1) is determined by the formula(C – D) / DwhereCis the total amount of deposits insured by the Corporation on April 30 of the current year; andDis the total amount of deposits insured by the Corporation on April 30, 2008.RoundingThe amount determined under subsection (3.1) shall be rounded to the nearest billion dollars or, if the amount is equidistant from two consecutive multiples of one billion dollars, it shall be rounded to the higher of those two multiples.No changeThe amount that the total principal indebtedness outstanding at any time in respect of borrowings under subsections (1) and (2) shall not exceed does not change if the amount determined under subsection (3.1) for the current year is less than the amount published under subsection (3.6) for the previous year.Date effectiveThe new amount that the total principal indebtedness outstanding at any time in respect of borrowings under subsections (1) and (2) shall not exceed comes into effect on December 31 of the current year.PublicationThe Corporation shall publish the new amount that the total principal indebtedness outstanding at any time in respect of borrowings under subsections (1) and (2) shall not exceed in its annual report following the day on which the new amount comes into effect.Fees for borrowingThe Minister may fix a fee to be paid by the Corporation to the Receiver General in respect of any borrowings by the Corporation and the Minister shall notify the Corporation in writing of any such fee.1996, c. 6, s. 24; 1997, c. 15, s. 111(E); 2009, c. 2, s. 236; 2012, c. 5, s. 186; 2018, c. 27, s. 1582020, c. 5, s. 322020, c. 6, s. 11
Powers of directorsThe Board shall administer the affairs of the Corporation in all things and make, or cause to be made, for the Corporation any description of contract that the Corporation may by law enter into.By-lawsThe Board may make by-laws,for the administration, management and control of the property and affairs of the Corporation;governing the functions, duties and remuneration of all officers, agents and employees of the Corporation;concerning conflicts of interest and post-employment matters relating to conflicts of interest in respect of directors, officers and employees of the Corporation;governing the appointment and activities of any special committees created for the purposes of the Corporation;governing the time and place for the holding of meetings of the directors, and the quorum and procedure in all things at those meetings;respecting the development, submission and maintenance of resolution plans by domestic systemically important banks, including specifying the contents of those plans;respecting representations by member institutions and other persons with respect towhat constitutes, or does not constitute, a deposit,what constitutes, or does not constitute, a deposit that is insured by the Corporation, andwho is a member institution;for the purpose of facilitating the Corporation’s exercise of its functions either under section 14 or in the event that an order is made under subsection 39.13(1), respecting the information that the Corporation can require from member institutions with respect to their deposit liabilities and the time within and manner in which it is to be provided to the Corporation;respecting the capabilities that the Corporation can require member institutions to have to facilitate the Corporation’s exercise of its functions either under section 14 or in the event that an order is made under subsection 39.13(1), including the capability toidentify their deposit liabilities, andtemporarily prevent withdrawals of deposit liabilities;prescribing anything that, by virtue of any provision of this Act, is to be prescribed by the by-laws;prescribing the form and manner in which payments under this Act are to be made by the Corporation; andgoverning the conduct in all other particulars of the affairs of the Corporation.Ministerial approvalA by-law made under paragraph (2)(e) is not effective unless it has been approved in writing by the Minister.Deposit liabilitiesFor the purposes of paragraphs (2)(f.1) and (f.2), deposit liabilities include deposits referred to in paragraphs 12(a) to (c) and liabilities referred to in subsections 2(2), (5) and (6) of the schedule.Subsection 5(1) of the Statutory Instruments ActIf a by-law requires approval in writing by the Minister under this Act in order to be effective, then, for the purposes of subsection 5(1) of the Statutory Instruments Act, the by-law is deemed to be made on the day on which the Corporation receives that approval.Inspection powersIn carrying out any inspection authorized by this Act or by a policy of deposit insurance, the directors of the Corporation have all the powers conferred on commissioners appointed under Part II of the Inquiries Act for the purpose of obtaining evidence under oath, and the directors may delegate those powers as occasion requires.R.S., 1985, c. C-3, s. 11; R.S., 1985, c. 18 (2nd Supp.), s. 2, c. 18 (3rd Supp.), s. 51; 1992, c. 26, s. 4; 2005, c. 30, s. 100; 2010, c. 12, ss. 1886, 1887; 2012, c. 5, s. 187; 2017, c. 20, s. 109
Minister’s directionThe Minister may, after consultation with the Board, the Governor of the Bank of Canada and the Superintendent, give a written direction to the Corporation if the Minister is of the opinion that not giving the direction might have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.Compliance without regard to minimizing lossThe Corporation shall comply with the direction without regard to the requirement referred to in paragraph 7(c) that it pursue its objects in a manner that will minimize its exposure to loss.ImplementationThe Corporation’s directors shall ensure that the direction is implemented in a prompt and efficient manner and, if in so doing they act in accordance with section 115 of the Financial Administration Act, they are not accountable for any consequences arising from the implementation of the direction.Notification of implementationAfter implementing the direction, the Corporation shall notify the Minister without delay that the direction has been implemented.Best interestsThe Corporation’s compliance with a direction is deemed to be in its best interests.2009, c. 2, s. 237
Statutory Instruments ActThe Statutory Instruments Act does not apply to a direction given under subsection 11.1(1).PublicationThe Minister shall cause a notice to be published in the Canada Gazette that a direction was given under subsection 11.1(1) as soon as the Minister is of the opinion that the publication of the notice will not have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.2009, c. 2, s. 237
Recovery of lossAfter the publication of a notice in the Canada Gazette that a direction was given under subsection 11.1(1), the Corporation shall, in accordance with its by-laws, collect a special premium from member institutions or any class of member institutions in order to recover the loss that the Corporation determines it incurred as a result of complying with the direction.2009, c. 2, s. 237
Deposit Insurance
Duty to insureThe Corporation shall insure each deposit with a member institution excepta deposit that is not payable in Canada;a deposit in respect of which Her Majesty in right of Canada would be a preferred claimant; andso much of any one deposit as exceeds one hundred thousand dollars.R.S., 1985, c. C-3, s. 12; 2005, c. 30, s. 1012018, c. 12, s. 2032020, c. 5, s. 122023, c. 26, s. 626
[Repealed, 2023, c. 26, s. 628]
DefinitionsThe following definitions apply in this section.continuation day, in respect of a local cooperative credit society continued as a federal credit union, means the day set out in the federal credit union’s letters patent continuing the local cooperative credit society as a federal credit union. (date de prorogation)pre-existing deposit means a deposit that was made with a local cooperative credit society before it is continued as a federal credit union and that remains outstanding on the continuation day. (dépôt préexistant)transition period, in respect of a pre-existing deposit, meansin the case of a pre-existing deposit that is to be repaid on a fixed day, the period that begins on the continuation day and ends on that fixed day; andin the case of any other pre-existing deposit, the period that begins on the continuation day and ends on the day that is 180 days after the continuation day. (période transitoire)Duty to insure certain pre-existing depositsDespite paragraph 12(c) and subsection 3(1.1) of the schedule, but subject to the other provisions of this Act, if a pre-existing deposit is held by a federal credit union that is a member institution and all or a portion of the pre-existing deposit would have been guaranteed or insured under the law of a province if the local cooperative credit society had not been continued as a federal credit union, the Corporation shall insure the pre-existing deposit during the transition period up to the amount that would have been guaranteed or insured under the law of that province.Duty to insure certain pre-existing deposits repayable on a fixed dayDespite paragraph 2(2)(a) of the schedule, the Corporation shall insure a pre-existing deposit during the transition period if the deposit is held by a federal credit union that is a member institution andis repayable on a fixed day that is more than five years after the deposit was made with the local cooperative credit society that was continued as a federal credit union; andwould have been guaranteed or insured under the law of a province if the local cooperative credit society had not been continued as a federal credit union.Deemed separate depositDuring the transition period, a pre-existing deposit, less any withdrawals from the pre-existing deposit, is deemed, for the purposes of deposit insurance with the Corporation, to be a deposit separate from any deposit made on or after the continuation day.Deemed withdrawal from pre-existing depositDuring the transition period, any withdrawal — up to the amount of the pre-existing deposit — is deemed, for the purposes of deposit insurance with the Corporation, to be withdrawn from the pre-existing deposit.2010, c. 12, s. 2098; 2018, c. 27, s. 159
Deposits with amalgamating institutionsWhen a person has deposits with two or more member institutions that amalgamate and continue in operation as one member institution, in this section referred to as the “amalgamated institution”, a deposit of that person with an amalgamating institution on the day on which the amalgamated institution is formed, less any withdrawals from the deposit, shall, for the purposes of deposit insurance with the Corporation, be deemed to be and continue to be separate from any deposit of that person on that day with the other amalgamating institution or institutions that become part of the amalgamated institution for a period of two years or, in the case of a term deposit with a remaining term exceeding two years, to the maturity of the term deposit.Deposits with amalgamated institutionA deposit made by a person referred to in subsection (1) with an amalgamated institution after the day on which the amalgamated institution is formed shall be insured by the Corporation only to the extent that the aggregate of that person’s deposits with the amalgamated institution, exclusive of the deposit in respect of which the calculation is made, is less than one hundred thousand dollars.ExceptionA deposit that is insured under subsection 12.1(2) is not to be taken into account when calculating the aggregate of a person’s deposits under subsection (2).Where assets acquiredFor the purpose of deposit insurance with the Corporation, if a member institution assumes deposit liabilities of another member institution, those member institutions are deemed to be amalgamating institutions and subsections (1) to (2.1) apply if a person has deposits with both institutions.Deemed depositsWhere a member institution assumes deposit liabilities of another member institution, the deposits in respect of those liabilities are, for the purposes of sections 21, 23 and 25.1, deemed to be deposited with the member institution that assumes them as of the day on which they are assumed.Deemed withdrawal from depositDuring the period referred to in subsection (1), any withdrawal by a person — up to the total amount, on the day on which the amalgamated institution is formed, of that person’s deposits with the two or more member institutions that amalgamate — shall, for the purposes of deposit insurance with the Corporation, be deemed to be withdrawn from those deposits.R.S., 1985, c. C-3, s. 13; 1992, c. 26, s. 5; 1996, c. 6, s. 25; 2005, c. 30, s. 102; 2010, c. 12, s. 2099; 2018, c. 27, s. 160
Obligation regarding insured amountAs soon as possible after the Corporation is obliged to make payment in respect of a deposit insured by deposit insurance, it shall make available to the person that in its opinion appears to be entitled to be paid in respect of the deposit an amount of money equal to so much of the person’s deposit as is insured by the Corporation.Inability to form opinionThe Corporation shall not make any money available under subsection (1) to a nominee broker or a professional trustee in relation to a trust deposit if information that the Corporation has requested under paragraph 7(1)(b) of the schedule or paragraph 11(b) of the schedule, as the case may be, has not been provided in relation to that deposit.How amount to be made availableThe amount is to be made available by making a monetary payment to the person or a deposit to the credit of the person at another member institution, whether or not the person has an account at that institution. The Corporation may make the amount available in more than one instalment if, in its opinion, it is appropriate to do so.Obligatory paymentThe Corporation shall, in the manner described in subsection (1.1), make payment in respect of any deposit insured by deposit insurance if a winding-up order has been made in respect of the member institution that holds the deposit.Discretionary paymentThe Corporation may, in the manner described in subsection (1.1), make payment in respect of any deposit insured by deposit insurance ifthe member institution that holds the deposit is unable, by reason of an order of a court or of any action taken by a supervisory or regulatory body, to make any payment in respect of the deposit;the policy of deposit insurance of the member institution that holds the deposit is terminated or cancelled; oran order is made in respect of the federal member institution under subsection 39.13(1).[Repealed, 1996, c. 6, s. 26]How interest on deposit to be calculatedFor the purpose of calculating the payment of the Corporation in respect of any deposit insured by deposit insurance where a winding-up order has been made in respect of the member institution that holds the deposit, the interest accruing and payable in relation to the deposit shall be included only to the date of the commencement of the winding-up.Corporation may pay interestWhere the Corporation makes a payment pursuant to subsection (2), the Corporation may pay, in addition to the amount the Corporation is obliged to pay, interest on that amount at a rate determined in accordance with rules prescribed by the by-laws for the period commencing on the date of the commencement of the winding-up in respect of the member institution that holds the deposit and ending on the date of the making of the payment in respect of the deposit, but the aggregate of the payments made under this subsection and subsection (2) in relation to the deposit shall in no case exceed one hundred thousand dollars.How interest and deposit to be calculatedFor the purpose of calculating the payment of the Corporation in respect of any deposit insured by deposit insurance where the Corporation makes a payment pursuant to subsection (2.1),subject to paragraph (b), the interest accruing and payable in relation to the deposit shall be included only to the date of the payment by the Corporation; orif a proceeding for the winding-up of the member institution that holds the deposit has been commenced before the date of the payment by the Corporation but a winding-up order has not yet been made, the interest accruing and payable in relation to the deposit shall be included only to the date of the commencement of the winding-up.Interest on index-linked depositsThe interest referred to in subsection (2.3) or (2.5) in relation to a deposit held by a member institution shall be determined in accordance with rules prescribed by the by-laws if a payment to be made by the member institution in respect of the deposit is to be determined, in whole or in part, by reference in any way tothe market price of a security, commodity or financial instrument;the exchange rate between any two currencies;a reference rate determined by reference to any one or more of those prices or rates; orany other kind of variable index or reference point that may be described in rules prescribed by the by-laws.ExceptionWhere a winding-up order is made in respect of a member institution, subsection (2) does not apply to any deposit in respect of which payment was made pursuant to subsection (2.1).Preparatory examinationIf the Corporation believes that it would be in the best interests of both the depositors with the member institution and the Corporation that preparations be made to make a payment under this Act in respect of a deposit held by a member institution, the Corporation may make or cause to be made by any person designated by the Corporation, an examination of the books, records and accounts of the member institution relating to its deposit liabilities. For the purposes of the examination, the Corporation and the person designated by it have a right of access to those books, records and accounts and are entitled to require the member institution’s directors, officers, auditors and any receiver or liquidator of the member institution to furnish any information and explanations regarding the deposits held by the member institution that the Corporation or person may require.Costs of examinationThe costs incurred by the Corporation in carrying out an examination in respect of a member institution under subsection (2.7) shall be paid by the member institution and may be recovered by the Corporation as a debt due and payable to the Corporation.Date of computing liabilityFor the purposes of calculating the payment to be made by the Corporation in respect of any deposit insured by deposit insurance, the amount of the deposit shall be determined, where the Corporation makes a payment pursuant tosubsection (2), as of the date of the commencement of the winding-up;subsection (2.1) in the winding-up circumstances described in paragraph (2.5)(b), as of the date of the commencement of the winding-up; orsubsection (2.1), otherwise than in the winding-up circumstances described in paragraph (2.5)(b), as of the date on which any of the circumstances described in subsection (2.1) first occurs in respect of the member institution concerned.Posting requirementFor the purposes of calculating the payment to be made by the Corporation in respect of any deposit insured by deposit insurance, the deposit, other than accrued interest, must be posted in the member institution’s records in accordance with the member institution’s regular transaction posting process as of the applicable date referred to in subsection (2.9).Foreign currency exchangeFor the purposes of calculating the payment to be made by the Corporation in respect of any deposit payable in a foreign currency that is insured by deposit insurance, the amount of the deposit must be determined in Canadian currency in accordance with the Bank of Canada’s published exchange rate on the applicable date referred to in subsection (2.9) or, if there is no such published rate, the last exchange rate published by the member institution before that applicable date.Discharge of liabilityPayment under this section by the Corporation in respect of any deposit insured by deposit insurance discharges the Corporation from all liability to the extent of the amount of the payment made in respect of that deposit, and in no case is the Corporation under any obligation to see to the proper application in any way of the payment so made.SubrogationWhere the Corporation makes a payment under this section in respect of any deposit with a member institution, the Corporation is subrogated, to the extent of the amount of the payment made, to all the rights and interests of the depositor and may maintain an action in respect of those rights and interests in the name of the depositor or in the name of the Corporation.Subrogation — returned paymentIn the case of a returned payment, at the expiry of one year from the applicable date referred to in subsection (2.9), the Corporation is subrogated, to the extent of the amount of the returned payment, to all the rights and interests of the depositor and may maintain an action in respect of those rights and interests in the name of the depositor or in the name of the Corporation.PriorityIf the Corporation is subrogated to the rights and interests of a depositor under subsection (4) or (4.01) in respect of any deposit with a member institution that is being wound up, the Corporation ranks,to the extent that the payment was made under subsection (2) or (2.1), including in the case of a returned payment, equally with the depositor in respect of their deposit; andto the extent that the payment includes any interest paid under subsection (2.4), equally with the depositor in respect of interest accruing and payable on their deposit after the date of the making of the winding-up order.No set-off or compensationDespite section 73 of the Winding-up and Restructuring Act, if the Corporation makes a payment under this section in respect of any deposit with a member institution, the law of set-off or compensation does not apply to a claim by the Corporation on the estate of the member institution in respect of that payment.AssignmentWhere the Corporation deems it advisable, it may withhold payment in respect of any deposit with a member institution until it has received an assignment in writing of all the rights and interests of the depositor in relation to the deposit.Time limitation for claimsNo action may be taken against the Corporation in respect of the obligation of the Corporation to make a payment in relation to a deposit held by a member institution that is being wound up unless the action is commenced within ten years after the date of the commencement of the winding-up.InterpretationIn this section, commencement of the winding-up means the time a winding-up is deemed to commence pursuant to section 5 of the Winding-up and Restructuring Act.R.S., 1985, c. C-3, s. 14; R.S., 1985, c. 18 (3rd Supp.), s. 52; 1992, c. 26, s. 6; 1996, c. 6, s. 26; 1997, c. 15, s. 112; 2005, c. 30, s. 103; 2007, c. 6, s. 403; 2009, c. 2, s. 238; 2012, c. 5, s. 188; 2018, c. 12, s. 204; 2018, c. 27, s. 161
Payment to the Bank of CanadaThe Corporation shall pay to the Bank of Canada an amount equal to a returned payment within three months after the expiry of a 10-year period from the applicable date referred to in subsection 14(2.9), and payment to the Bank of Canada accordingly discharges the Corporation from all liability in respect of the returned payment.NoticeThe Corporation shall mail to each person to whom a returned payment remains payable, at the person’s address in so far as the address is known to the Corporation, a notice that the returned payment remains unpaid and that payment of an amount equal to the returned payment will be paid by the Corporation to the Bank of Canada. The notice must be sent at least six months before the date by which payment is to be made by the Corporation to the Bank of Canada and must also include the mailing address and websites where information can be obtained on how to claim the returned payment from the Corporation before payment is made by the Corporation to the Bank of Canada.Provision of informationThe Corporation shall, on making a payment under subsection (1), provide to the Bank of Canada the amount of the returned payment and, in so far as it is known to the Corporation, any information that the Bank of Canada determines is necessary to verify the identity of the depositor who is entitled to the returned payment, includingthe depositor’s name;the depositor’s address;information relating to the depositor’s pieces of identification; andinformation relating to another person’s authority to act on behalf of the depositor.Payment to claimantSubject to section 22 of the Bank of Canada Act, if payment has been made to the Bank of Canada under subsection (1) in respect of any returned payment, and if payment is demanded from the Bank of Canada by the person who, but for that subsection, would be entitled to receive the returned payment, the Bank of Canada is liable to pay an amount equal to the amount so paid to it to the claimant.Enforcing liabilityThe liability of the Bank of Canada under subsection (4) may be enforced by action or other civil proceeding against the Bank of Canada in any court of competent jurisdiction.2012, c. 5, s. 189
Sale of information to liquidatorThe Corporation may sell to the liquidator of a member institution appointed under the Winding-up and Restructuring Act any information that was gathered or produced at the expense of the Corporation, if that expense is not one that may be recovered by the Corporation from the member institution under subsection 14(2.8).Payment part of winding-up costsAny amount paid by the liquidator for that information is deemed for the purpose of section 94 of the Winding-up and Restructuring Act to be a cost incurred in the winding-up of the member institution.1997, c. 15, s. 113
Premiums recoverableA premium assessed by the Corporation against a member institution for the purposes of this Act constitutes a debt owing to Her Majesty in right of Canada and the amount thereof together with any interest levied by the Corporation as an overdue charge is recoverable by action in any court of competent jurisdiction.R.S., 1985, c. C-3, s. 15; R.S., 1985, c. 18 (2nd Supp.), s. 3, c. 18 (3rd Supp.), s. 53
[Repealed, R.S., 1985, c. 18 (3rd Supp.), s. 53]
Insurance of federal institutionsThe Corporation shall, in the manner and to the extent provided in this Act and the by-laws, insure the deposits held by a federal institution in respect of which an order approving the commencement and carrying on of business has been made by the Superintendent unlessthat order prohibits the institution from accepting deposits in Canada;that order authorizes the institution to accept deposits in Canada solely in accordance with subsection 413(3) of the Bank Act, subsection 378.1(2) of the Cooperative Credit Associations Act or subsection 413(2) of the Trust and Loan Companies Act;the institution has been authorized under section 26.03 to accept deposits payable in Canada while no longer being a member institution; orthe institution’s policy of deposit insurance has been terminated under section 31 or cancelled under section 33.Effect of amendment to orderIf the order approving the commencement and carrying on of business by a federal institution is at any time amended so as to not contain the prohibition or restriction referred to in paragraphs (1)(a) and (b), respectively,on the day on which the amendment takes effect, any authorization under section 26.03 that permits the institution to accept deposits payable in Canada while no longer being a member institution is revoked;on the day on which the amendment takes effect, any existing cancellation of the institution’s policy of deposit insurance under paragraph 33(1)(b) or (c) or subsection 33(2) is revoked; andas of the day on which the amendment takes effect, the Corporation shall insure the deposits held by the institution under subsection (1).ExceptionSubsection (2) does not apply in respect of a federal institution whose policy of deposit insurance has been terminated under section 31 or cancelled under paragraph 33(1)(a).Notice to CorporationThe Superintendent shall notify the Corporation ofevery application to incorporate a federal institution, or to continue a corporation as a federal institution, in respect of which the Superintendent is likely to make an order approving the commencement and carrying on of business that does not contain the prohibition or restriction referred to in paragraphs (1)(a) and (b), respectively; andevery application by a federal institution to have its order approving the commencement and carrying on of business amended so as to not contain the prohibition or restriction referred to in paragraphs (1)(a) and (b), respectively.R.S., 1985, c. C-3, s. 17; R.S., 1985, c. 18 (3rd Supp.), s. 54; 1991, c. 45, s. 543; 2005, c. 30, s. 104; 2007, c. 6, s. 404; 2012, c. 5, s. 190
Insurance of provincial institutionsOn the application of a provincial institution, the Corporation may insure the deposits held by the institution in the manner and to the extent provided in this Act and the by-laws, ifthe Corporation approves the institution for deposit insurance;the institution is authorized by the province of its incorporation to apply for deposit insurance;the institution agrees, in carrying on its business, not to exercise powers substantially different from the powers exercisable by a company to which the Trust and Loan Companies Act applies; andthe Corporation is satisfied that at all times the Corporation will have adequate access to information regarding the institution.2007, c. 6, s. 404
Policy of deposit insuranceEvery member institution is deemed to have obtained a policy of deposit insurance on the day on which it became a member institution.2007, c. 6, s. 404
Form of application for deposit insuranceAn application for deposit insurance shall be in the form, and accompanied by a fee of the amount and type, that may be prescribed by the by-laws.[Repealed, R.S., 1985, c. 18 (3rd Supp.), s. 55]Contents of policyThe policy of deposit insurance shall consist of the provisions that may be prescribed by the by-laws.Records retained outside CanadaWhere a member institution that is authorized to do so under the by-laws retains at a place outside Canada records referred to in the policy of deposit insurance, including for the purpose of any examination by or on behalf of the Corporation, the Corporation may, in the case referred to in paragraph (a), and shall, in the case referred to in paragraph (b), direct the institution to maintain a copy of those records in Canada:if the Corporation is of the opinion that it does not have immediate, direct, complete and ongoing access to those records; orif the Corporation is advised by the Minister that the Minister is of the opinion that it is not in the national interest for the institution not to maintain a copy of those records in Canada.By-lawsThe Board may make by-laws respecting:what constitutes immediate, direct, complete and ongoing access, for the purpose of paragraph (3.1)(a); andthe time within and manner in which a member institution is required to comply with a direction under subsection (3.1).Policies deemed to be amendedIf a by-law respecting the content of the policy of deposit insurance is amended, or revoked and replaced, every policy of deposit insurance is deemed to be amended or replaced accordingly.R.S., 1985, c. C-3, s. 18; R.S., 1985, c. 18 (3rd Supp.), s. 55; 1992, c. 26, s. 7; 1999, c. 28, s. 100; 2007, c. 6, s. 4052020, c. 1, s. 21
[Repealed, R.S., 1985, c. 18 (3rd Supp.), s. 56]
FundsThe Corporation shall maintain funds for the purpose of carrying out its objects.R.S., 1985, c. C-3, s. 20; 2018, c. 27, s. 162
Assessment and collection of premiumsThe Corporation shall, for each premium year, assess and collect from each member institution an annual premium in an amount equal to the lesser ofthe annual premium for that member institution determined under the by-laws, andthe maximum annual premium.By-laws re premiumsThe Board may make by-laws respecting the determination of annual premiums for member institutions and, without restricting the generality of the foregoing, may make by-lawsfor the establishment of a system of classifying member institutions in different categories;respecting the criteria or factors to be taken into account or procedures to be followed by the Corporation in determining the category in which a member institution is classified; andfixing the amount of, or providing for the manner of determining the amount of, the annual premium applicable to each category.When by-law not effectiveA by-law made under subsection (2) is not effective unless it has been approved in writing by the Minister.Maximum annual premiumIn this section, maximum annual premium means, in respect of a member institution, the greater of$5,000, andone third of one per cent, or such smaller proportion of one per cent as may be fixed in respect of the premium year by the Governor in Council, of an amount equal to the sum of so much of the deposits as are considered to be insured by the Corporation and deposited with the member institution as of April 30 in the immediately preceding premium year.Calculation of depositsFor the purposes of this section, a member institution may use any method approved by the Corporation for that premium year to determine or estimate the aggregate amount of its deposits that are considered to be insured by the Corporation.R.S., 1985, c. C-3, s. 21; R.S., 1985, c. 18 (3rd Supp.), s. 57; 1996, c. 6, s. 27; 2007, c. 6, s. 406; 2018, c. 27, s. 163
ReturnsThe premium payable by a member institution shall be based on returns to be certified by the institution and submitted in such form and at such time as the Corporation may require.Payable in instalmentsOne half of the premium payable by a member institution shall be paid to the Corporation on or before July 15 in the premium year for which the premium is payable and the remainder shall be paid to the Corporation, without interest, on or before December 15 in that premium year.R.S., 1985, c. C-3, s. 22; 1996, c. 6, s. 28
Calculation of first premiumThe premium payable by a member institution in respect of the premium year in which it becomes a member institution shall be the same proportion of the lesser ofthe annual premium for that member determined by by-law made under subsection 21(2) based on an amount equal to the sum of so much of the deposits as are considered to be insured by the Corporation and deposited with the member institution as of the end of the month in which it becomes a member institution, andthe greater of$5,000, andone third of one per cent, or such smaller proportion of one per cent as may be fixed in respect of the premium year by the Governor in Council, of an amount equal to the sum of so much of the deposits as are considered to be insured by the Corporation and deposited with the member institution as of the end of the month in which it becomes a member institution,as the number of days in which any of the deposits with that member institution are insured by the Corporation in that premium year is of 365.Payment of first premiumDespite subsection 22(2), the premium payable by a member institution under subsection (1) must be paid to the Corporation, without interest, within 30 days after the end of the month in which the member institution becomes a member institution.R.S., 1985, c. C-3, s. 23; R.S., 1985, c. 18 (3rd Supp.), s. 58; 1996, c. 6, s. 29; 2001, c. 9, s. 207; 2007, c. 6, s. 407
Where premiums payableAll premiums payable shall be paid to the Corporation at its head office.R.S., 1985, c. C-3, s. 24; R.S., 1985, c. 18 (3rd Supp.), s. 58; 2009, c. 2, s. 239
No set-off on premium paymentNo member institution shall, without the prior agreement of the Corporation, reduce or extinguish a premium payment, interest or other payment to be made to the Corporation by reason of a set-off or claim by the member institution against the Corporation.1996, c. 6, s. 30; 2001, c. 9, s. 208
Overdue chargesNotwithstanding anything in sections 21 to 23, the Corporation may charge interest at a rate equal to the rate prescribed pursuant to subsection 161(1) of the Income Tax Act plus two per cent on the unpaid amount of any premium instalment not paid on or before the due date of that instalment.R.S., 1985, c. C-3, s. 25; R.S., 1985, c. 18 (3rd Supp.), s. 58
Premium surchargeNotwithstanding sections 21 to 25, where, in the opinion of the Corporation, a member institution is engaging in such practice as may be prescribed in the by-laws as warranting a premium surcharge, the Corporation, afterconsultation with the Superintendent or the provincial supervisor, as the case may be, andgiving the member institution an opportunity to make written representations,may assess and collect from the member institution a premium surcharge in respect of the premium year or any part thereof.Amount of premium surchargeThe amount of the premium surcharge that may be assessed against and collected from a member institution under subsection (1) in respect of any premium year shall be such amount as the Corporation may determine to be fair in the circumstances and in no case shall exceed an amount equal to one sixth of one per cent of so much of each deposit as is considered to be insured by the Corporation and deposited with the member institution as of April 30 in the immediately preceding premium year.Application of sections 21 to 25The provisions of sections 21 to 25 that are not inconsistent with subsections (1) and (2) apply, with such modifications as the circumstances require, in respect of any premium surcharge assessed under subsection (1).R.S., 1985, c. 18 (2nd Supp.), s. 4, c. 18 (3rd Supp.), s. 59; 1996, c. 6, s. 31; 2007, c. 6, s. 408
Non-application to special premiumSection 21, subsection 22(2), section 23 and subsection 37(5) do not apply to a special premium.2009, c. 2, s. 240
By-laws — special premiumIn respect of each order made under subsection 7.1(1) or each direction given under subsection 11.1(1), the Board may make by-laws respecting the recovery from member institutions or any class of member institutions of the loss referred to in section 7.3 or 11.3, as the case may be, including by-lawsfixing the special premium payable by member institutions or any class of member institutions or providing for the manner of fixing the special premium;establishing a system of classifying member institutions in different classes;establishing the criteria or factors to be taken into account or procedures to be followed by the Corporation in determining the class in which a member institution is classified; orrespecting the time and manner in which a special premium shall be paid.When by-law not effectiveA by-law made under subsection (1) is not effective unless it has been approved in writing by the Minister.2009, c. 2, s. 240
InterpretationFor the purposes of sections 21 to 25.3, the deposits that are considered to be insured by the Corporation include the total amount of all deposits held in accounts that are identified as professional trustee accounts in accordance with section 9 of the schedule.2018, c. 12, s. 205
[Repealed, 2018, c. 27, s. 164][Repealed, 1996, c. 6, s. 32]
Federal Institutions Without Deposit Insurance
InterpretationSubject to subsections (2) and (3), for the purposes of sections 26.02 to 26.06, deposit has the meaning that would be given to it by the schedule, for the purposes of deposit insurance, if the schedule were read without reference to subsections 2(2), (5) and (6) of the schedule.ExceptionFor the purposes of subparagraph 26.03(1)(c)(iii) and paragraph 26.03(1)(d), deposit has the meaning that would be given to it by the schedule, for the purposes of deposit insurance, but does not include deposits not payable in Canada.ExceptionFor the purposes of paragraph 26.03(1)(b) and subsection 26.03(2), deposit has the meaning that would be given to it by the schedule, for the purposes of deposit insurance, if the schedule were read without reference to subsections 2(2), (5) and (6) of the schedule, but does not include deposits prescribed by the by-laws.By-lawsThe Board may make by-lawsprescribing the deposits referred to in subsection (3); andprescribing terms and conditions with respect to the acceptance of those deposits.1997, c. 15, s. 114; 1999, c. 28, s. 1012018, c. 12, s. 206
ApplicationIf a federal member institution intends to accept deposits payable in Canada while no longer being a member institution, it must apply to the Corporation for an authorization to do so. The application must be in a form that is acceptable to the Corporation and must contain the information that the Corporation may require.1997, c. 15, s. 114; 2007, c. 6, s. 410
Granting of applicationSubject to section 26.04, the Corporation may give that authorization if[Repealed, 2001, c. 9, s. 209]the sum of all the deposits held by the federal member institution that are less than $150,000 and payable in Canada is less than one per cent of the sum of all the deposits held by the institution that are payable in Canada;the institution has informed all its depositors, in accordance with any rules that may be prescribed by the by-laws,that the institution has applied to become authorized to accept deposits while no longer being a member institution,that after the institution receives that authorization, no deposit with the institution will be insured in whole or in part by the Corporation, andthat the institution’s obligation to repay the deposit to the depositor will be assumed by a member institution if an option referred to in subparagraph (d)(i) or (ii) is not exercised;in respect of each deposit that is held by the institution, the institution hasobtained from the depositor an acknowledgement in writing that the deposit will no longer be insured in whole or in part by the Corporation after the institution receives authorization to accept deposits without being a member institution,at the request in writing of the depositor, paid to the depositor the principal amount of the deposit and interest determined in accordance with rules prescribed by the by-laws and has not charged any fee or penalty in connection with the payment, orobtained from a member institution an agreement in writing to assume the institution’s liability in relation to the deposit on the same terms and conditions; andthe institution has paid to the Corporation a fee determined in accordance with rules prescribed by the by-laws.Exchange rateFor the purpose of subsection (1), the rate of exchange that shall be applied on any day in determining the amount in Canadian dollars of a deposit in a currency of a country other than Canada shall be determined in accordance with rules prescribed by the by-laws.1997, c. 15, s. 114; 1999, c. 28, s. 102; 2001, c. 9, s. 209; 2007, c. 6, s. 411
Minister and Superintendent to be informedBefore giving an authorization under subsection 26.03(1), the Corporation must inform the Minister and the Superintendent that it proposes to give the authorization.Minister may prevent authorizationIf the Minister is of the opinion that giving the authorization would not be in the public interest, the Minister may, within thirty days after being informed about the proposal to give the authorization, direct the Corporation not to give the authorization.Authorization after 30 daysIf the Minister does not issue that direction within those 30 days, the Corporation may then give the authorization under subsection 26.03(1). The giving of the authorization cancels the policy of deposit insurance of the federal member institution to which the authorization is given.Amendment of orderIf the Corporation gives the authorization under subsection 26.03(1), the Superintendent must, under paragraph 54(1)(a) of the Bank Act, paragraph 62(1)(a) of the Cooperative Credit Associations Act or paragraph 58(1)(b) of the Trust and Loan Companies Act, as the case may be, amend the federal member institution’s order approving the commencement and carrying on of business accordingly.1997, c. 15, s. 114; 1999, c. 28, s. 103; 2007, c. 6, s. 412
Fees by-lawA by-law prescribing rules for the purpose of paragraph 26.03(1)(e) is not effective unless it has been approved in writing by the Minister.1997, c. 15, s. 114
Deposits not insuredAfter a federal member institution has been given authorization under subsection 26.03(1), no deposit with the institution is insured in whole or in part by the Corporation.1997, c. 15, s. 114; 2007, c. 6, s. 413
Inspection of Member Institutions
Annual inspectionsThe Superintendent shall, notwithstanding any other Act of Parliament, examine on behalf of the Corporation the affairs of each federal member institution once in each year and at the times that the Corporation may require for a specified purpose.CostsWhere an examination under subsection (1) is made for a specified purpose, such costs incurred in relation thereto as in the opinion of the Superintendent are extraordinary shall be borne by the Corporation.R.S., 1985, c. C-3, s. 27; R.S., 1985, c. 18 (3rd Supp.), s. 60; 1991, c. 45, s. 544; 1999, c. 28, s. 104
Provincial member institutionsIt is a condition of the policy of deposit insurance of a provincial member institution thatthe Corporation or a person designated by the Corporation may, at least once in each year and at such other times as the Corporation deems appropriate, make or cause to be made such inspections of the affairs of the provincial member institution as the Corporation or that person may deem to be necessary or expedient;the Corporation and the person designated by the Corporation have, for the purposes referred to in paragraph (a), a right of access to the records of the member institution; andthe member institution will cause its officers and auditors to furnish such information and explanations pertaining to its affairs as the Corporation or the person designated by the Corporation may require.R.S., 1985, c. C-3, s. 28; R.S., 1985, c. 18 (3rd Supp.), s. 60
Costs may be charged backWhere an examination or an inspection is carried out other than once in each year, the Corporation maypay the costs of the examination or inspection;charge the costs to the member institution in respect of which they were incurred; andrecover the costs from the member institution as a debt due and payable to the Corporation.1996, c. 6, s. 33; 1999, c. 28, s. 105
Examination considerationsThe person who conducts an examination under section 27 or an inspection under section 28 in respect of a member institution shall make all examinations or inspections that the person considers necessary toprovide, by way of a rating or any other means, an assessment of the safety and soundness of the member institution, including its financial condition;comment on the operations of the member institution;if the member institution is a domestic systemically important bank, provide an assessment of its capacity to absorb losses that it is required to maintain under section 485 of the Bank Act; andif the member institution is a provincial institution and the Corporation and the person agree, comment on whether the provisions of the statutes governing the provincial institution are being complied with.ReportsThe person shall provide written reports to the Corporation on the matters referred to in paragraphs (1)(a) to (c) in a timely manner.Right of Corporation to informationThe Corporation is entitled to all information obtained by or produced by or for the person, whether in the course of conducting the examination or inspection or otherwise, regarding the affairs of the member institution or any of its affiliates or of any person dealing with the member institution or any of its affiliates.Obligation to provide other informationWithout limiting subsection (3), the person shall provide the Corporation with any information that the person considers relevant to any matter referred to in any of paragraphs (1)(a) to (c) or to any report provided under subsection (2).Obligation to informThe person shall without delay inform the Corporation if, at any time, whether in the course of conducting an examination or inspection or otherwise, there comes to the attention of the person any change in the circumstances of the member institution that might materially affect the position of the Corporation as an insurer.R.S., 1985, c. C-3, s. 29; R.S., 1985, c. 18 (3rd Supp.), s. 61; 1992, c. 26, s. 8(E); 1996, c. 6, s. 34; 1999, c. 28, s. 106; 2001, c. 9, s. 210; 2005, c. 30, s. 105; 2016, c. 7, s. 128
Review of returnsIf requested to do so by the Corporation, the person who conducts an examination under section 27 or an inspection under section 28 in respect of a member institution shall review, or cause another person to review on the person’s behalf, within the time specified by the Corporation, the correctness of the returns made by the member institution on which its premiums are based and through which its premium classification is in part determined.2001, c. 9, s. 210
Certain reports to be provided to CorporationWhen a report is sent by the Superintendent to the Minister under section 643 of the Bank Act, section 505 of the Trust and Loan Companies Act or section 437 of the Cooperative Credit Associations Act, a copy of the report shall be sent by the Superintendent at the same time to the Corporation.2001, c. 9, s. 210
Reporting breachesIf, in the Corporation’s opinion, a member institution is in breach of a provision of this Act or the regulations, a by-law of the Corporation or a condition of its policy of deposit insurance, the Corporation may send a report of the facts to the chief executive officer or chairperson of the board of directors of the member institution. The report may be sent by registered mail or delivered by hand and a copy of it must be provided to the Minister.Presentation of report to directorsThe chief executive officer or chairperson of the board of directors of a member institution to whom a report has been sent or delivered under subsection (1) shall, within 15 days after the receipt of the report, causethe report to be presented to a meeting of the board of directors of the member institution and to be incorporated in the minutes of the meeting; anda certified copy of that portion of the minutes of the meeting that relates to the presentation of the report to be sent by registered mail to the chief executive officer of the Corporation at its head office.R.S., 1985, c. C-3, s. 30; R.S., 1985, c. 18 (3rd Supp.), s. 62; 1992, c. 26, s. 9(E); 1996, c. 6, s. 35; 2005, c. 30, s. 106; 2012, c. 5, s. 193(E); 2016, c. 7, s. 129
Termination and Cancellation of Insurance
Notice of terminationWhere a report has been sent or delivered under subsection 30(1) and the progress made by the member institution in remedying the breach is not satisfactory to the Corporation, the Corporation shall, by notice,where the member institution is a federal member institution, so inform the institution and the Minister; andwhere the member institution is a provincial member institution, give the institution not less than thirty days notice of the termination of its policy of deposit insurance.Copy to provincial MinisterWhere a notice of termination is given to a provincial member institution under subsection (1), the Corporation shall forthwith send a copy thereof to the appropriate provincial Minister.Termination of policyThe policy of deposit insurance of a provincial member institution shall terminate on the expiration of the period specified in the notice given under subsection (1) unless, before the expiration of that period,the Corporation is satisfied that the member institution is taking the necessary action to remedy the breach to which the notice relates; orthe appropriate provincial Minister requests an extension of the period to enable the necessary remedial action to be taken, in which case the termination may be deferred by the Corporation for a further period not exceeding sixty days.Where report on federal member institutionWhere a report has been sent or delivered under subsection 30(1) in respect of a federal member institution and the member institution and the Minister have been informed in accordance with subsection (1) by the Corporation that the Corporation is not satisfied with the member institution’s progress in remedying the breach to which the report relates, the Corporation may, unless the Minister advises the Corporation that the Minister is of the opinion that it is not in the public interest to do so, give the member institution not less than thirty days notice of the termination of its policy of deposit insurance.Termination of policyThe policy of deposit insurance of a federal member institution shall terminate on the expiration of the period specified in the notice given under subsection (4) or such later period not exceeding sixty days as the Corporation may determine unless, before the expiration of that period, the Corporation is satisfied that the member institution is taking the necessary action to remedy the breach to which the notice relates.Conditions of extensionThe Corporation may impose conditions on a federal member institution in connection with any extension of the period referred to in subsection (5) and failure by the federal member institution to comply with any such condition constitutes a termination of the extension.Revoking noticeWhere, at any time after a notice of termination has been given to a member institution under subsection 31(1) or (4), the Corporation is satisfied that as the result of any action by the member institution, or any other person, the risk to depositors or to the Corporation has been averted or substantially reduced, the Corporation may revoke its notice of termination.R.S., 1985, c. C-3, s. 31; R.S., 1985, c. 18 (3rd Supp.), s. 62; 1992, c. 26, s. 10(E); 1996, c. 6, s. 36; 2005, c. 30, s. 107
Acceleration of termination of policy of deposit insuranceDespite any other provision of this Act, if, at any time after a notice of termination has been given to a provincial member institution under subsection 31(1), the Corporation concludes thatthe financial condition of the provincial member institution has deteriorated since the giving of the notice, andthe interests of depositors will be adversely affected by any further delay in terminating the provincial member institution’s policy of deposit insurance,the Corporation shall without delay send a notice by registered mail, or deliver a notice by hand, to the provincial member institution and to the appropriate provincial Minister, to the effect that the policy of deposit insurance of the institution will be terminated on the expiration of a period of five days after the receipt of the notice by the institution.RevocationThe Board of Directors of the Corporation or one of its committees established for the purpose may, before the expiry of the period specified in the notice, revoke the notice if, after considering any written representations made by the provincial member institution, it is satisfied that it is appropriate to do so.[Repealed, 2007, c. 6, s. 414]RevocationThe Corporation shall revoke a notice sent or delivered under subsection (1) where the appropriate provincial Minister or provincial supervisor, as the case may be, has taken control of the provincial member institution or its assets.Termination of policyUnless a notice sent or delivered under subsection (1) is revoked under subsection (3) or (4), the policy of deposit insurance of the provincial member institution to which the notice was sent or delivered shall terminate on the expiration of the period specified in the notice.Effect of revocationThe revocation of a notice under subsection (3) or (4) does not revoke a notice given under subsection 31(1).R.S., 1985, c. 18 (3rd Supp.), s. 62; 1996, c. 6, s. 37; 2007, c. 6, s. 414
Termination of policy by provincial member institutionA provincial member institution may terminate a policy of deposit insurance by giving such notice of termination as may be required by the policy.Effect of terminationUnless the policy of deposit insurance of a provincial member institution otherwise provides, section 34 applies in respect of deposits with the institution on the termination of the policy by the institution.R.S., 1985, c. C-3, s. 32; R.S., 1985, c. 18 (3rd Supp.), s. 62
CancellationSubject to subsection (3), the policy of deposit insurance of a member institution may be cancelled by the Corporation if, in the opinion of the Corporation, the member institutionis or is about to become insolvent;has ceased to accept deposits; orhas not begun to accept deposits within a period of two years beginning on the day on which it became a member institution.CancellationIf a member institution intends to cease to accept deposits, it must notify the Corporation and the institution’s policy of deposit insurance may, subject to subsection (3), be cancelled by the Corporation.No cancellation in certain casesThe Corporation shall notify the Minister and the Superintendent of the action it is proposing to take under subsection (1) or (2) and it shall not take the action if it is advised by the Minister that in the opinion of the Minister taking the action would not be in the public interest.R.S., 1985, c. C-3, s. 33; R.S., 1985, c. 18 (3rd Supp.), s. 62; 1996, c. 6, s. 38; 2007, c. 6, s. 415; 2012, c. 5, s. 194
Effect of termination or cancellationIf the policy of deposit insurance of a member institution is terminated or cancelled by the Corporation, the deposits with the institution on the day the termination or cancellation takes effect, less any withdrawals from those deposits, continue to be insured under the terminated or cancelled policy of deposit insurance for a period of two years or, in the case of a term deposit with a remaining term exceeding two years, to the maturity of the term deposit.Non-application of continued coverageSubsection (1) does not apply in respect of a deposit witha member institution if the deposit has been assumed by another member institution; ora former member institution that has received authorization to accept deposits payable in Canada without being a member institution and the policy of deposit insurance of which has been cancelled.Corporations not member institutionsA corporation is not considered to be a member institution by reason only that its deposits continue to be insured under subsection (1).Continuing obligationsTermination or cancellation of a policy of deposit insurance does not relieve a former member institution from obligations and liabilities to the Corporation that have accrued before the termination or cancellation.Amendment of orderIf the policy of deposit insurance of a federal member institution is cancelled by the Corporation under paragraph 33(1)(b) or (c) or subsection 33(2), the Superintendent must, under paragraph 54(1)(a) of the Bank Act, paragraph 62(1)(a) of the Cooperative Credit Associations Act or paragraph 58(1)(b) of the Trust and Loan Companies Act, as the case may be, amend the federal member institution’s order approving the commencement and carrying on of business to prohibit the institution from accepting deposits in Canada.R.S., 1985, c. C-3, s. 34; 1996, c. 6, s. 39; 1999, c. 28, s. 107; 2007, c. 6, s. 416; 2012, c. 5, s. 195
Creditor remedies availableWhere in the opinion of the Corporation a member institution is or is about to become insolvent, the Corporation is deemed to be a creditor of the member institution and the Corporation may initiate and take any measures or proceedings that a creditor of the member institution may initiate or take under law to preserve the assets of the member institution or to have it wound up or liquidated.No measures to be taken in certain casesThe Corporation shall notify the Minister of the action it is proposing to take under subsection (1) and shall not take the action if it is advised by the Minister that in the opinion of the Minister taking the action would not be in the public interest.PresumptionFor the purposes of this section, the Corporation is deemed to be a creditor of a member institution despite the termination or cancellation of the institution’s policy of deposit insurance.R.S., 1985, c. C-3, s. 35; R.S., 1985, c. 18 (3rd Supp.), s. 63; 1992, c. 27, s. 90; 1993, c. 34, s. 14; 1996, c. 6, s. 40; 2007, c. 6, s. 417
Removal of references to deposit insuranceIf the policy of deposit insurance of a member institution is terminated or cancelled, the member institution shall notify its depositors of that fact and shall remove all references to deposit insurance under this Act from all forms of advertising by the institution.Public noticeThe Corporation may, in the manner and through any news media that it considers appropriate, give public notice of the termination or cancellation of the policy of deposit insurance of a member institution if, in the opinion of the Corporation, the public interest requires that such notice be given.R.S., 1985, c. C-3, s. 36; 2007, c. 6, s. 418
Provincial Insuring Arrangements
Provincial deposit insuranceIf under the law of any province the government of the province or an agent of that government guarantees or insures any of the deposits with a provincial institution operating within the province, the Corporation, subject to section 17.1 and any agreement entered into under subsection (3), mayinsure some or all of the deposits with the institution; oramend the institution’s policy of deposit insurance, to exclude from the policy any of the deposits with the institution.[Repealed, 2007, c. 6, s. 419]Agreement with provinceThe Corporation may, with the approval of the Governor in Council, enter into an agreement with the government, or an agent of the government, of a province referred to in subsection (1), to provide for reciprocal arrangements relating to the administration or operation of the law of that province and of this Act.RegulationsFor the purpose of enabling the Corporation to carry out an insuring arrangement referred to in subsection (1) or provided for in an agreement under subsection (3), the Governor in Council may, by regulation, make provision for any matter or thing arising from the insuring arrangement or agreement.Refund of premiumsWhere the Corporation during any premium year ceases to insure any of the deposits held by a member institution that is a provincial institution, by reason of the fact that such deposits are guaranteed or insured pursuant to the law of a province, the Corporation may refund to that provincial institution the proportion of the premium paid by the provincial institution to the Corporation for that premium year in respect of those deposits that bears the same relation to the premium for the full premium year in respect of those deposits that the unexpired part of the premium year bears to the full premium year, but in no case shall a refund be made that will reduce the premium paid by the provincial institution to the Corporation for the premium year to less than five thousand dollars.SavingNothing in this section shall be construed as authorizing the Corporation to insure deposits contrary to section 12.Definition of depositsIn this section, deposits includes a part of a deposit.R.S., 1985, c. C-3, s. 37; R.S., 1985, c. 18 (3rd Supp.), s. 64; 2007, c. 6, s. 419
Agreements for examination of provincial institutionsNotwithstanding section 28, the Corporation may enter into an agreement with the government, or an agent of the government, of a province referred to in subsection 37(1) to provide forthe exchange between the Corporation and that government or agent of information that is obtained by any examination of provincial institutions required by this Act or the law of that province; andspecial examinations, by representatives of both parties to the agreement and at the request of either party, of any of the provincial institutions that are member institutions operating in that province.In lieu of examinationThe Corporation may accept information received from an exchange of information referred to in paragraph (1)(a) in lieu of any examination required by this Act.R.S., c. C-3, s. 32
Short term loans to insuring agentsThe Corporation may, with the approval of the Governor in Council and on such terms and conditions as the Governor in Council may prescribe, enter into an agreement with an agent of the government of a province that guarantees or insures deposits with provincial institutions in that province, to extend to that agent short term loans, secured by such security as the Corporation deems adequate, to enable that agent to meet short term requirements for liquid funds arising from its operations.R.S., c. C-3, s. 33
Restructuring of Federal Member InstitutionsResolution Plans
Submission of planA domestic systemically important bank shall, on the request of the Corporation, develop and maintain a resolution plan that meets the requirements referred to in paragraph 11(2)(e) and shall submit that plan to the Corporation.2017, c. 20, s. 110
Vesting in Corporation and Appointing Corporation as Receiver
Report of SuperintendentWhere the Superintendent is of the opinion thata federal member institution has ceased, or is about to cease, to be viable, andthe viability of the federal member institution cannot be restored or preserved by the exercise of the Superintendent’s powers under the Bank Act, the Trust and Loan Companies Act or the Cooperative Credit Associations Act,the Superintendent, after providing the federal member institution with a reasonable opportunity to make representations, shall, in writing, report thereon to the Corporation.Forming opinionFor the purposes of subsection (1), the Superintendent may take into account all matters the Superintendent considers relevant, but in all cases the Superintendent shall have regard to whether, in the opinion of the Superintendent,the federal member institution is dependent to an excessive extent on loans, advances, guarantees or other financial assistance to sustain its operations;the federal member institution has lost the confidence of depositors and the public;the federal member institution’s regulatory capital, within the meaning assigned to that expression by the Bank Act, the Trust and Loan Companies Act or the Cooperative Credit Associations Act, whichever is applicable, is or is about to become substantially deficient; orthe federal member institution has failed to pay any liability that has become due and payable or will not be able to pay its liabilities as they become due and payable.Report by Superintendent on winding-up circumstancesWhere the Superintendent is of the opinion thatcircumstances exist in respect of a federal member institution that would allow the Superintendent to take control of the federal member institution under the Bank Act, the Trust and Loan Companies Act or the Cooperative Credit Associations Act, andif such control were taken, grounds would exist for the making of a winding-up order in respect of the federal member institution,the Superintendent, after providing the federal member institution with a reasonable opportunity to make representations, shall, in writing, report thereon to the Corporation.UrgencyDespite subsections (1) and (3), the Superintendent may report to the Corporation orally if he or she is of the opinion that the federal member institution’s circumstances must be considered without delay.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2001, c. 9, s. 211; 2009, c. 2, s. 242
Request of CorporationOn receipt of a report made by the Superintendent under section 39.1, the Corporation mayafter determining that a transaction referred to in section 39.2 is reasonably likely to be expeditiously carried out after the making of the order, request the Minister to recommend that one or more orders be made under subsection 39.13(1); orin the case of a domestic systemically important bank, request the Minister to recommend that one or more orders be made under subsection 39.13(1) and that an order be made under subsection 39.13(1.3).1992, c. 26, s. 11; 1996, c. 6, s. 41; 1999, c. 31, s. 28(F); 2016, c. 7, s. 130
Recommendation of MinisterIf a request referred to in section 39.11 is made by the Corporation, the Minister may, if he or she is of the opinion that it is in the public interest to do so, recommend to the Governor in Council that one or more orders be made under subsection 39.13(1) in respect of the federal member institution and, in the case of a domestic systemically important bank, that an order be made under subsection 39.13(1.3) in respect of that institution.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 130
OrderThe Governor in Council may, on the recommendation of the Minister made under section 39.12, by order,vest in the Corporation the shares and subordinated debt of the federal member institution that are specified in the order;appoint the Corporation as receiver in respect of the federal member institution;direct the Minister to incorporate a federal institution designated in the order as a bridge institution and specify the date and time as of which the federal member institution’s deposit liabilities are assumed; ordirect the Corporation to carry out a conversion under subsection 39.2(2.3).Condition precedentThe making of an order, under paragraph (1)(b), appointing the Corporation as receiver of the federal member institution is a condition precedent to the making of an order under paragraph (1)(c) in respect of the federal member institution.Conditions for conversionAn order may be made under paragraph (1)(d) in respect of the federal member institution only if the institution is a domestic systemically important bank and an order has also been made under paragraph (1)(a) or (b) in respect of the institution.Order — longer periodThe Governor in Council may, on the recommendation of the Minister made under section 39.12, by order, require the Corporation to apply for a winding-up order in respect of the federal member institution in accordance with subsection 39.22(1.1).Effects of vesting orderAn order made under paragraph (1)(a)vests in the Corporation the shares and subordinated debt that are subject to the order, free from any adverse claim, including any claim that a transfer was wrongful or that a particular adverse person was the owner of or had an interest or right in respect of the shares or subordinated debt, even though the Corporation knows of the adverse claim;extinguishes any such adverse claim to the extent that the claim is a claim that a person other than the Corporation is the owner of or has an interest or right in respect of the shares or subordinated debt;does not extinguish any such adverse claim to the extent that the claim is a personal claim against a person other than the Corporation or a person claiming under it;does not prevent a secured creditor or assignee or successor in interest of the person who was the holder of the shares or subordinated debt immediately before the making of the order from being entitled to receive compensation under section 39.23; andgives the Corporation the right to recover, out of the assets of the federal member institution and in priority to all other claims, all the costs, charges and expenses properly incurred by the Corporation in furtherance of the order, including those related to its operation of the institution.Federal credit unionIn addition to subsection (2), if an order made under paragraph (1)(a) is in respect of a federal credit union, the Corporation has the powers, rights and privileges it would have if it were a member of the federal credit union and the federal credit union is exempt from any requirement to have a minimum number of members for so long as the shares are vested in the Corporation.Effects of receivership orderAn order made under paragraph (1)(b)constitutes the Corporation as the exclusive receiver of the assets and undertaking of the federal member institution or of such part thereof as may be specified in the order;gives the Corporation, as receiver, in respect of the assets and undertaking of the federal member institution or such part thereof as may be specified in the order, the power toenter the federal member institution and take possession and control of the assets and require any person therein to account for and deliver up to the Corporation possession and control of the assets,subject to subparagraph (iii), sell or otherwise dispose of the assets and undertaking by private or public sale or in such other manner and on such terms and conditions as the Corporation deems appropriate,sell or otherwise dispose of any asset that is subject to an agreement creating a security interest to any person who agrees to assume the obligation secured by the security interest,arrange for the assumption by any person of all or any part of the federal member institution’s liabilities,carry on the business of the federal member institution to the extent that the Corporation deems is necessary or beneficial to the receivership,sue for, defend, compromise and settle, in the name of the federal member institution, any claim made by or against it,in the name of the federal member institution, do all acts and execute all receipts and other documents and for that purpose, when necessary, use its seal, anddo all such other things as may be necessary or incidental to the exercise of the Corporation’s rights, powers, privileges and immunities as receiver; andgives the Corporation the right to recover, out of the assets of the federal member institution and in priority to all other claims, all the costs, charges and expenses properly incurred by the Corporation in furtherance of the order, including those related to its operation of the institution.For greater certainty — bankruptcyFor greater certainty, shares and subordinated debt that are subject to an order made under paragraph (1)(a) and that, immediately before the making of the order, are vested in a trustee in bankruptcy under the Bankruptcy and Insolvency Act are vested in the Corporation.For greater certainty — exercising rightsFor greater certainty, an order made under paragraph (1)(a) or (b) prevents any person, other than the Corporation, who is the holder of shares or subordinated debt or other debts or liabilities of the federal member institution or who is a party to or a beneficiary of a contract with the institution, and any secured creditor or assignee or successor in interest of such a person, from exercising any voting or other rights arising from the person’s status in any manner that could defeat or interfere with the rights, powers, privileges and immunities of the Corporation as holder of shares or subordinated debt or as receiver, as the case may be.Receiver order dealingsWhere an order is made under paragraph (1)(b),the Corporation, as receiver, may exercise its powers, rights, privileges and immunities without leave, approval or other intervention of a court, but may seek the assistance of a superior court in order to give effect to those powers, rights, privileges and immunities,an asset of the federal member institution that is acquired from the Corporation, as receiver, shall, except to the extent that it is an asset referred to in subparagraph (3)(b)(iii), be acquired free of any adverse claim of the federal member institution or any other person, andthe Corporation, as receiver, may cause or refrain from causing any obligation of the federal member institution to be performed and may cause the federal member institution to incur an obligation or do so on its behalf,and the Corporation shall not, by reason of its appointment as receiver or any action taken by it, be held to have assumed or incurred any obligation of the federal member institution for its own account.Non-liability — environmental mattersWithout limiting the generality of subsection (5) and despite anything in federal or provincial law, the Corporation, as receiver, is not liable in that capacity for any environmental condition that arose or environmental damage that occurredbefore the Corporation’s appointment as receiver; orafter the Corporation’s appointment as receiver unless it is established that the condition arose or the damage occurred as a result of the Corporation’s gross negligence or wilful misconduct or, in Quebec, the Corporation’s gross or intentional fault.Reports, etc., still requiredNothing in subsection (5.1) exempts the Corporation, as receiver, from any duty to report or make disclosure imposed by a law referred to in that subsection.Non-liability — certain ordersWithout limiting the generality of subsection (5) and despite anything in federal or provincial law but subject to subsection (5.2), if an order is made that has the effect of requiring the Corporation, as receiver, to remedy any environmental condition or environmental damage affecting property involved in the receivership, the Corporation, as receiver, is not liable for failure to comply with the order, and is not liable for any costs that are or would be incurred by any person in carrying out the terms of the order,if, within the time that is specified in the order, or within 10 days after the appointment of the Corporation as receiver if the order is in effect when the Corporation is appointed as receiver, the Corporation, as receiver,complies with the order, oron notice to the person who issued the order, abandons, disposes of or otherwise releases any interest in any real property, or any right in any immovable, affected by the condition or damage; orif the Corporation, as receiver, had, before the order was made, abandoned, disposed of or otherwise released any interest in any real property, or any right in any immovable, affected by the condition or damage.Non-liability — employeesWithout limiting the generality of subsection (5) and despite anything in federal or provincial law, the Corporation, as receiver, is not liable in respect of a liability, including one as a successor employer,that is in respect of the employees or former employees of the federal member institution or a predecessor of the federal member institution or in respect of a pension plan for the benefit of those employees or former employees; andthat existed before the Corporation is appointed as receiver or that is calculated by reference to a period before the Corporation’s appointment.Liability of other successor employersSubsection (5.4) does not affect the liability of a successor employer other than the Corporation, as receiver.Order conclusiveAn order made under this section and any action taken or decision made in furtherance of such an order are for all purposes final and conclusive and shall not be questioned or reviewed in any court.1992, c. 26, ss. 11, 16; 1996, c. 6, s. 41; 2009, c. 2, s. 243; 2010, c. 12, ss. 1888, 2100; 2012, c. 5, s. 196; 2016, c. 7, s. 131
[Repealed, 2016, c. 7, s. 132]
[Repealed, 2016, c. 7, s. 132]
Powers of CorporationIf an order is made under paragraph 39.13(1)(a) or (b) in respect of a federal member institution, the powers, duties, functions, rights and privileges of the directors of the federal member institution and those of its officers who are responsible for its management are suspended except to the extent that is specified in writing by the Corporation. The Corporation may exercise those powers, rights and privileges and perform those duties and functions.Suspension of powers, rights, etc.In addition to subsection (1), if an order made under paragraph 39.13(1)(a) or (b) is in respect of a federal credit union, the powers, rights and privileges of its members are suspended, but nothing in this subsection affects the powers, rights and privileges of the Corporation under subsection 39.13(2.1).ShareholdersIf an order is made under paragraph 39.13(1)(a) or (b) in respect of a federal member institution, the powers, rights and privileges of its shareholders to vote or give approvals are suspended and the Corporation may exercise those powers, rights and privileges.Persons to assistThe Corporation may appoint one or more persons to assist it in the management of any federal member institution or in carrying out the Corporation’s functions as holder of shares or subordinated debt or as receiver and may delegate to those persons any of the powers, duties, functions, rights or privileges of the directors and officers of the federal member institution.[Repealed, 2016, c. 7, s. 133]Power to appoint and removeIf an order is made under paragraph 39.13(1)(b) in respect of a federal member institution, the Corporation may appoint or remove any director of the federal member institution.Corporation’s directionsIf an order is made under paragraph 39.13(1)(a) or (b) in respect of a federal member institution, the Corporation may give directions to the board of directors of the federal member institution, including to make, amend or repeal any by-law of the institution.ImplementationThe board of directors of the federal member institution shall ensure that a direction given under subsection (5) is implemented in a prompt and efficient manner and shall, after implementing a direction, notify the Corporation without delay that it has been implemented.By-laws — board of directorsThe board of directors of the federal member institution may, with the prior approval of the Corporation, make, amend or repeal any by-law of the institution.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2010, c. 12, s. 2101; 2016, c. 7, s. 133
Stay of proceedingsWhere an order is made under subsection 39.13(1),no action or other civil proceeding before a judicial or quasi-judicial body and no arbitration may be commenced or continued against the federal member institution or in respect of its assets other than a proceeding under the Winding-up and Restructuring Act commenced by the Corporation or the Attorney General of Canada;no attachment, garnishment, execution or other method of enforcement of a judgment or order against the federal member institution or its assets may take place or continue;no creditor of the federal member institution has any remedy against the federal member institution or its assets;except in the normal course of clearing and settlement processes, including the consolidation of accounts in respect of those processes or the services referred to in paragraph (5)(c), no creditor has any right of set-off or compensation against the federal member institution;no person may terminate or amend any agreement with the federal member institution or claim an accelerated payment, or forfeiture of the term, under such an agreement by reason only ofthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the agreement,a monetary default, before the order was made, under the agreement by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the order is made,the making of the order or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,the assignment or assumption of the agreement to or by a bridge institution or a third party,the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,a conversion under subsection 39.2(2.3) in respect of the federal member institution, ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities; andno person may terminate the federal member institution’s membership in an organization by reason only ofthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the rules of the organization,a monetary default, before the order was made, under the rules of the organization by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the order is made,the making of the order or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,the transfer of the federal member institution’s membership to a bridge institution or a third party,the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,a conversion under subsection 39.2(2.3) in respect of the federal member institution, ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.Stay of proceedings — before conversionIf an order is made under paragraph 39.13(1)(d), no person may terminate or amend any agreement with the federal member institution that is in relation to any of that institution’s shares or liabilities that are prescribed by the regulations made under subsection 39.2(10), claim an accelerated payment or forfeiture of the term under such an agreement or demand payment of any amount under such an agreement, by reason only of a monetary default by that institution in the performance of obligations under the agreement when that default occurs after the order was made but before a conversion under subsection 39.2(2.3) in respect of that institution.Agreements overriddenWhere an order is made under subsection 39.13(1), any stipulation in an agreement is of no force or effect if ithas the effect of providing for or permitting anything that, in substance, is contrary to paragraph (1)(e), subsection (1.1) or paragraph 39.13(3)(b); orprovides, in substance, that the federal member institution ceases to have the rights — or, in the case of a bridge institution, does not have the rights — to use or deal with assets that the federal member institution or bridge institution would otherwise have, onthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the agreement,a monetary default, before the order was made, under the agreement by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the order is made,the making of the order or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,the assignment or assumption of the agreement to or by a bridge institution or a third party,the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,a conversion under subsection 39.2(2.3) in respect of the federal member institution, ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.Organization’s rules — no force or effectIf an order is made under subsection 39.13(1), any stipulation in the rules of an organization is of no force or effect if ithas the effect of providing for or permitting anything that, in substance, is contrary to paragraph (1)(f) or 39.13(3)(b); orprovides, in substance, that the federal member institution ceases to have the rights — or, in the case of the bridge institution, does not have the rights — of a member of the organization, that the federal member institution or the bridge institution would otherwise have, onthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the rules of the organization,a monetary default, before the order was made, under the rules of the organization by the federal member institution or any of its affiliates that is remedied by the institution within 60 days after the day on which the order is made,the making of the order or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,the transfer of the federal member institution’s membership to a bridge institution or a third party,the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,a conversion under subsection 39.2(2.3) in respect of the federal member institution, ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.Clearing arrangementsSubsections (1) to (2.1) do not apply so as to prevent a member of the Canadian Payments Association from acting or ceasing to act as a clearing agent for a federal member institution in accordance with the Canadian Payments Act and the by-laws and rules of that Association.ExceptionDespite subsection (3), if a clearing agent that is a member of the Canadian Payments Association acts in that capacity for a federal member institution at the time an order is made under subsection 39.13(1) in respect of the institution, the clearing agent shall continue to act in that capacity for the institution after the order is made, if the Corporation has given an undertaking to provide the financial assistance that the institution needs in order to discharge its obligations to the clearing agent as they become due.Clearing houseSubsections (1) to (2.1) do not apply so as to prevent a clearing housefrom acting or ceasing to act in that capacity for a federal member institution; orfrom exercising its rights under its settlement rules, as defined in subsection 8(5) of the Payment Clearing and Settlement Act.ExceptionDespite subsection (3.2), a clearing house that acts in that capacity for a federal member institution at the time an order is made under subsection 39.13(1) in respect of the institution shall continue to act in that capacity for the institution and subsections (1) to (2.1) apply in respect of the clearing house, if the Corporation has given an undertaking to provide the financial assistance that the institution needs in order to discharge its obligations to the clearing house as they become due.Rights subject to set-off or compensationA federal member institution in respect of which an order is made under subsection 39.13(1) may not enforce against a person a right to receive an amount against which the person, but for paragraph (1)(d), would have a right of set-off or compensation.Further supplies and advancesNothing in subsection (1) or (2) shall be construedas prohibiting a person from requiring payments to be made in cash for goods, services, use of leased or licensed property or other valuable consideration provided after the making of the order;as requiring the advance to a federal member institution in respect of which an order is made under subsection 39.13(1) of money or credit after the making of the order; oras requiring the provision to a federal member institution in respect of which an order is made under subsection 39.13(1) of any of the following services where to do so would be likely, in the reasonable opinion of the person providing the service, to result in that person advancing money or credit to the federal member institution after the making of the order or to give rise, after the making of the order, to a claim of that person against the federal member institution, namely,cash management services,services related to the redemption of debt instruments,services related to the issuance of letters of credit or guarantees,cheque certification services,currency supply services,funds transfer services and remittance order services,securities delivery and settlement services,charge, credit, debit and payment card services,automated banking and teller machine services,electronic funds transfer at point of sale services,consignment cheque services,other services similar to those referred to in subparagraphs (i) to (xi),any service of a kind prescribed by the regulations, anda guarantee of liabilities in respect of any of the services referred to in subparagraphs (i) to (xiii).Security agreements, assignments and transfersParagraphs (1)(b) to (e) and subsection (2) do not apply in respect of a remedy under, or a stipulation of, a security agreement creating a security interest in assets of a federal member institution or an agreement assigning or transferring the institution’s right, title or interest in any real property or immovable situated in Canada, including any mortgage or hypothec on that real property or immovable, ifan obligation secured by the agreement is to the Bank of Canada or the Corporation; orthe Superintendent, on the application of the federal member institution, exempted the agreement from the application of those paragraphs and that subsection before the making of an order under subsection 39.13(1) and the Corporation does not undertaketo ensure that the obligations secured by the security interest or the assignment or transfer will be assumed by a bridge institution or a third party, orto provide the federal member institution with the financial assistance that it needs to discharge the obligations secured by the security interest or the assignment or transfer as they become due.Eligible financial contractsNothing in subsection (1), (2) or (2.1) prevents the following actions from being taken in accordance with the provisions of an eligible financial contract:the termination or amendment of the contract;the accelerated payment or forfeiture of the term under the contract;the exercise of remedies for a failure to satisfy an obligation under or in connection with the contract, including the payment of an amount payable — or the delivery of property deliverable — under or in connection with the contract;the netting or setting off or compensation of an amount payable under or in connection with the contract;any dealing with financial collateralto satisfy an amount payable — or the delivery of property deliverable — under or in connection with the contract,for the purpose of calculating an amount payable under or in connection with the contract by way of netting, setting off or compensation of the financial collateral or application of the proceeds or value of the financial collateral, oras a remedy for a failure described in paragraph (c); orany dealing with financial collateral, other than a dealing set out in paragraph (e).InterpretationFor the purposes of paragraphs (7)(e) and (f), dealings with financial collateral includethe sale or foreclosure or, in Quebec, the surrender of financial collateral; andthe netting, setting off or compensation of financial collateral or the application of the proceeds or value of financial collateral.[Repealed, 2016, c. 7, s. 134]Stay — eligible financial contractsIf an order is made under subsection 39.13(1), the actions referred to in paragraphs (7)(a), (b) and (f) are not to be taken by reason only ofthe insolvency or deteriorated financial condition of the federal member institution, any of its affiliates or any of its providers of credit support or guarantors in respect of the institution’s obligations under the eligible financial contract;the assignment or assumption of the eligible financial contract to or by a bridge institution or a third party;the making of the order or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order;a conversion under subsection 39.2(2.3) in respect of the federal member institution; ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.Stay terminated — noticeIf the Corporation considers that all or substantially all of the federal member institution’s assets will be transferred to a third party and that an eligible financial contract of that institution will not be assigned to a third party, it may give notice to that effect to the parties to that contract, in which case paragraphs (7.1)(a) and (c) cease to apply in respect of that contract at the date and time the notice is issued.Stay terminatedParagraph (7.1)(a) and, if the order made under subsection 39.13(1) directs the incorporation of a bridge institution, paragraph (7.1)(c) cease to apply to an eligible financial contract at 5:00 p.m. at the location of the Corporation’s head office on the second business day after the day on which the order is made under subsection 39.13(1), unless the Corporation has undertaken, before that time, to assign the contract to a bridge institution.InterpretationFor greater certainty, paragraph (7.1)(a) and, if applicable, paragraph (7.1)(c) cease to apply in respect of an eligible financial contract to which both subsection (7.101) and (7.102) apply on the earlier of the date and time that a notice is issued under subsection (7.101) and the date and time set out in subsection (7.102).Insolvency or deteriorated financial conditionDespite subsections (7.101) and (7.102), an action set out in paragraph (7)(a), (b) or (f) may only be taken by reason of the insolvency or deteriorated financial condition described in paragraph (7.1)(a) if that insolvency or deteriorated financial condition exists on the date and time paragraph (7.1)(a) ceases to apply.EvidenceNothing in paragraphs (7.1)(b) to (e) prevents a person from relying on the facts that led to the making of an order under subsection 39.13(1) as evidence of the insolvency or deteriorated financial condition described in paragraph (7.1)(a).Agreements overriddenAny stipulation in an eligible financial contract is of no force or effect if ithas the effect of providing for or permitting anything that, in substance, is contrary to subsection (7.1); orprovides, in substance, that, by reason of the occurrence of any circumstance described in paragraphs (7.1)(a) to (e), the federal member institution ceases to have the rights — or, in the case of a bridge institution, does not have the rights — to use or deal with assets that the federal member institution or bridge institution would otherwise have.ExceptionSubsection (7.1) does not apply in respect of an eligible financial contract between the federal member institution andHer Majesty in right of Canada;the government of a foreign country;a central bank; ora clearing house, unless the Corporation has given the undertaking referred to in subsection (3.3) in respect of the institution.Assignment of eligible financial contractsSubject to subsection (7.21), the Corporation may assign to a bridge institution or a third party eligible financial contracts — including any claim under such contracts — that are between a federal member institution and an entity or any of the following entities if the Corporation assigns all of those eligible financial contracts to the bridge institution or the third party:another entity that is controlled — directly or indirectly — by the entity;another entity that controls — directly or indirectly — the entity; oranother entity that is controlled — directly or indirectly — by the entity referred to in paragraph (b).Eligible third partiesThe Corporation may assign eligible financial contracts to a third party under subsection (7.2) if the third party has met any condition that may be prescribed in the by-laws and has certified in writing thatit maintains all material licences and registrations that are required for the continued operation of its business and, if applicable, that it is in good standing in respect of those licences and registrations;it has, on its balance sheet, assets that exceed its liabilities;it is able to discharge its obligations in respect of the assigned eligible financial contracts as they become due; andits creditworthiness, taking into account any credit support or guarantee in respect of its obligations under the assigned contracts, is at least as good as the federal member institution’s creditworthiness was immediately before the order was made under subsection 39.13(1), taking into account any credit support or guarantee in respect of the federal member institution’s obligations under those contracts.Effects of assignment of eligible financial contractsIf any of the eligible financial contracts are assigned to or assumed by a bridge institution or a third party,the Corporation shall assign all of the federal member institution’s obligations arising from the eligible financial contracts, and the bridge institution or the third party shall assume those obligations; andthe federal member institution’s interest or right in property that secures its obligations under the eligible financial contracts is transferred to the bridge institution or the third party.Application of this sectionA federal member institution that is part of a class prescribed by the by-laws must ensure in accordance with the by-laws that this section — or provisions that have substantially the same effect as this section — applies to any eligible financial contract to which the institution is a party and that is part of a class prescribed by the by-laws.By-lawsThe Board may make by-laws respecting the manner in which a federal member institution referred to in subsection (7.4) is to ensure that this section — or provisions that have substantially the same effect as this section — applies to an eligible financial contract referred to in that subsection.Different treatmentThe by-laws made under subsection (7.5) may distinguish among classes of federal member institutions and classes of eligible financial contracts.RegulationsThe Governor in Council may make regulations prescribingkinds of services for the purposes of subparagraph (5)(c)(xiii); andkinds of agreements for the purposes of the definition eligible financial contract in subsection (9).DefinitionsThe following definitions apply in this section.business day means a day, other than a Saturday or a holiday at the location of the head office of the federal member institution. (jour ouvrable)clearing agent has the same meaning as in section 1 of the Canadian Payments Association By-law No. 3 — Payment Items and Automated Clearing Settlement System. (agent de compensation)clearing house meansa clearing house, as defined in section 2 of the Payment Clearing and Settlement Act, that provides clearing, settlement or payment message exchange services for a clearing and settlement system designated under section 4 of that Act; ora securities and derivatives clearing house, as defined in subsection 13.1(3) of the Payment Clearing and Settlement Act. (chambre de compensation)eligible financial contract means an agreement of a prescribed kind. (contrat financier admissible)financial collateral has the same meaning as in subsection 13(2) of the Payment Clearing and Settlement Act. (garantie financière)title transfer credit support agreement means an agreement under which title to property has been provided for the purpose of securing the payment or performance of an obligation in respect of an eligible financial contract. (accord de transfert de titres pour obtention de crédit)1992, c. 26, s. 11; 1996, c. 6, s. 41; 2001, c. 9, s. 212; 2007, c. 29, s. 103; 2009, c. 2, s. 245; 2010, c. 12, ss. 1889, 1890; 2012, c. 5, s. 198, c. 31, s. 166; 2016, c. 7, s. 134; 2017, c. 33, ss. 180, 1862021, c. 23, s. 126
Stay of proceedings — bridge institutionAny action or other civil proceeding before a judicial or quasi-judicial body and any arbitration, to which a bridge institution may become a party by virtue of acquiring an asset or assuming a liability of the federal member institution shall be stayed for a period of 90 days from the day on which the bridge institution acquires the asset or assumes the liability.WaiverThe bridge institution may waive the stay referred to in subsection (1).1992, c. 26, s. 11; 1996, c. 6, s. 41; 2009, c. 2, s. 246; 2012, c. 5, s. 199
Assignments — bridge institution or third partySubject to subsection (2), if an agreement with a federal member institution is assigned to or assumed by a bridge institution or a third party,a person is prohibited from terminating or amending the agreement, or claiming an accelerated payment or forfeiture of the term under the agreement, by reason only ofthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,the making of an order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the agreement,a monetary default, before the order was made, under the agreement by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the agreement is assigned or assumed,the assignment or assumption of the agreement to or by a bridge institution or a third party,the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,a conversion under subsection 39.2(2.3) in respect of the federal member institution, ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities; andany stipulation in the agreement that has the effect of providing for or permitting anything that, in substance, is contrary to any of subparagraphs (a)(i) to (viii) or provides, in substance, that the bridge institution or the third party does not have the rights to use or deal with assets that the bridge institution or the third party would otherwise have by reason of the occurrence of any circumstance described in those subparagraphs, is of no force or effect.ExceptionSubparagraphs (1)(a)(iii) and (iv) do not apply to an eligible financial contract, as defined in subsection 39.15(9).Membership in organizationIf a bridge institution or a third party becomes a member of an organization in place of a federal member institution, it is prohibited for the organization to terminate the membership of the bridge institution or of the third party by reason only ofthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors;the making of an order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order;a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the rules of the organization;a monetary default, before the order was made, under the rules of the organization by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the order is made;the transfer of the federal member institution’s membership to a bridge institution or a third party;the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates;a conversion under subsection 39.2(2.3) in respect of the federal member institution; ora conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.2012, c. 5, s. 199; 2016, c. 7, s. 135
ExemptionThe Governor in Council may, in an order made under subsection 39.13(1), provide that subsection 39.15(1) or (2) or any portion thereof does not apply in respect of the federal member institution.1992, c. 26, s. 11; 1996, c. 6, s. 41
Leave of courtA superior court may, on any terms that it considers proper, grant leave to a person to do anything that the person would otherwise be prevented from doing by section 39.15 or lift, or reduce the length of, a stay under section 39.151 if the court is satisfiedthat the person is likely to be materially prejudiced if leave is not granted; orthat it is equitable on other grounds to grant leave.Corporation to be made partyThe Corporation must be joined as a respondent in any application under subsection (1) and is entitled to such notice of the application as the court considers proper.Orders of national effectAn order of a superior court of a province under subsection (1) may, if the order so provides, have effect in all or a part of Canada outside the province.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2012, c. 5, s. 200
TerminationSubject to subsection (2), sections 39.14 and 39.15 cease to apply in respect of a federal member institutionon the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution; oron the date that a winding-up order is made in respect of the federal member institution.ExceptionsIf a notice referred to in paragraph (1)(a) has been published but an order described in paragraph (1)(b) has not been made,paragraph 39.15(1)(e) or (f) or subsection 39.15(2) or (2.1) continues to apply to the extent that it produced its effects by reason ofthe insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,the making of the order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under an agreement or the rules of an organization,a monetary default, before the order was made, under an agreement or the rules of an organization by the federal member institution or any of its affiliates that was remedied within 60 days after the day on which the order was made,a conversion under subsection 39.2(2.3) in respect of the federal member institution, ora conversion of any of the federal member institution’s shares or liabilities in accordance with contractual terms of those shares or liabilities; andsubsections 39.15(7.1) to (7.3) continue to apply.Stay terminated by orderThe Governor in Council may, by order, declare that paragraph (2)(a) ceases to apply in respect of the federal member institution if the Governor in Council considers that all or substantially all of the institution’s assets have been transferred to a bridge institution or a third party.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2012, c. 31, s. 167; 2016, c. 7, s. 136; 2017, c. 33, s. 181
Non-application of Certain Legislative Provisions
Not agent or Crown corporationA federal member institution that is a subsidiary of the Corporation as a result of an order made under paragraph 39.13(1)(a) or (b), a bridge institution or a subsidiary of either of those institutions is not an agent of the Corporation or Her Majesty in right of Canada and, despite Part X of the Financial Administration Act, is not a parent Crown corporation, or a wholly-owned subsidiary, within the meaning of section 83 of that Act. Their respective directors, officers and employees are not part of the federal public administration.ExceptionDespite subsection (1), Division V of Part X of the Financial Administration Act and the regulations made under that Division apply to the federal member institution, the bridge institution or a subsidiary of either of those institutions as if it were a Crown corporation within the meaning of section 83 of that Act.2016, c. 7, s. 137
Part VII of Bank Act, etc., inapplicableThe following enactments do not apply in respect of shares of a federal member institution that are vested in the Corporation by an order made under paragraph 39.13(1)(a):section 12.1, paragraph 28(1)(a.1), section 35.1, paragraphs 40(f) and (g), sections 40.1, 47.03, 47.04, 47.06, 47.11, 47.12, 47.15, 47.17 and 47.18, subsection 53(2), paragraph 54(1)(b), section 60.1, subsections 79.2(1) and (2) and sections 159.1, 372, 373, 374, 375, 376, 376.1, 376.2, 377, 377.1, 377.2, 379, 382.1, 385, 401.11, 401.2 and 401.3 of the Bank Act;sections 407, 407.01, 407.02, 407.03, 407.1, 407.2, 408, 411, 428 and 430 of the Insurance Companies Act; andsections 375, 375.1, 376, 379 and 396 and subsection 399(2) of the Trust and Loan Companies Act.Public holding requirement re parentAn exemption from the application of section 385 of the Bank Act, section 411 of the Insurance Companies Act or section 379 of the Trust and Loan Companies Act that is granted under section 388 of the Bank Act, section 414 of the Insurance Companies Act or section 382 of the Trust and Loan Companies Act continues in force notwithstanding that the entity that controls the bank, insurance company, trust company or loan company is a federal member institution the shares of which are vested in the Corporation by an order made under paragraph 39.13(1)(a).TerminationSubsections (1) and (2) cease to apply in respect of a federal member institution on the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2001, c. 9, s. 213; 2010, c. 12, s. 2102
Provisions do not applySection 12.1, paragraph 28(1)(a.1), section 35.1, paragraphs 40(f) and (g), section 40.1, 47.11, 47.12, 47.15 and 47.18, subsection 53(2), paragraph 54(1)(b) and section 159.1 of the Bank Act do not apply if the Corporation is appointed as receiver of a federal member institution that is a federal credit union by an order made under paragraph 39.13(1)(b).TerminationSubsection (1) ceases to apply in respect of a federal member institution on the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution.2010, c. 12, s. 2103
Regulation to exempt or adaptThe Governor in Council may, by regulation,exempt federal member institutions in respect of which an order is made under subsection 39.13(1), bridge institutions or affiliates of either of those institutions, or any class of those institutions or class of their affiliates, or any other person from the application of any provision of this Act or the regulations or of the following Acts or the regulations made under them:the Bank Act,the Canadian Payments Act,the Cooperative Credit Associations Act,the Financial Consumer Agency of Canada Act,the Insurance Companies Act,the Office of the Superintendent of Financial Institutions Act,the Trust and Loan Companies Act, andthe Winding-up and Restructuring Act; orprovide that any provision of this Act or the regulations or of the Acts referred to in paragraph (a) or the regulations made under them applies to federal member institutions in respect of which an order is made under subsection 39.13(1), bridge institutions or affiliates of either of those institutions, or any class of those institutions or class of their affiliates, or any other person but only in the manner and to the extent provided for in the regulation made under this subsection, and adapt that provision for the purpose of that application.Order directed at a given federal member institutionThe Governor in Council or the Minister may, by order, do anything that may be done by regulation under subsection (1) in respect of a federal member institution in respect of which an order is made under subsection 39.13(1), a bridge institution, an affiliate of either of those institutions or any other person.Scope or conditionsAn exemption made under paragraph (1)(a) or subsection (2) may be limited in scope or duration or subject to conditions.Coming into forceAn order made by the Minister does not take effect before the later of the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution and the day on which an order made by the Governor in Council under subsection (2) expires.ExpiryAn order made by the Minister expires one year after the day on which the order comes into force or any shorter period specified in the order.ExtensionThe Minister may, by order, grant one or more extensions of the applicable period set out in subsection (5) — of up to one year each — but the last extension must expire not later than five years after the date specified in the notice described in subsection 39.2(3).Statutory Instruments ActThe Statutory Instruments Act does not apply to an order made under subsection (2).PublicationThe Minister shall cause an order made under subsection (2) to be published in the Canada Gazette as soon as he or she considers it appropriate to do so.2016, c. 7, s. 138
Office of Superintendent of Financial InstitutionsDespite subsection 4(2) of the Office of the Superintendent of Financial Institutions Act, if an order is made under subsection 39.13(1) in respect of a federal member institution, the objects of the Office of the Superintendent of Financial Institutions, in respect of the institution or, in the case of an order made under paragraph 39.13(1)(c), a bridge institution, areto monitor the institution in order to assess its financial condition and determine whether it is complying with its governing statute law and supervisory requirements under that law; andto report the Office’s findings to the Minister and the Corporation.ApplicationSubsection (1) applies during the period that begins on the day on which the order is made and endson the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution; oron the day on which the bridge institution ceases to be designated as such.2016, c. 7, s. 138
Restructuring Transactions
Restructuring transactionsIf an order is made under paragraph 39.13(1)(a), the Corporation may, in addition to any other of its rights and powers, carry out, or cause the federal member institution to carry out,a transaction or series of transactions that involves the sale of all or part of the shares or subordinated debt of the federal member institution;a transaction that involves the amalgamation of the federal member institution;a transaction or series of transactions that involves the sale or other disposition by the federal member institution of all or part of its assets or the assumption by another person of all or part of its liabilities, or both; andany other transaction or series of transactions the purpose of which is to restructure the business of the federal member institution.Transactions for disposition of assets or restructuringIf an order is made under paragraph 39.13(1)(b), the Corporation, as receiver, may, in addition to any other of its rights and powers, carry outa transaction or series of transactions that involves the sale or other disposition of all or part of the assets of the federal member institution or the assumption by another person of all or part of its liabilities, or both; andany other transaction or series of transactions the purpose of which is to restructure the business of the federal member institution.No approval required — transaction with bridge institutionIf a transaction referred to in subsection (1) or (2) between the Corporation, as receiver for a federal member institution, and a bridge institution requires the approval of the Minister or the Superintendent under the Bank Act, the Cooperative Credit Associations Act, the Insurance Companies Act or the Trust and Loan Companies Act, that approval is not required despite those Acts.Approval by MinisterIf a transaction referred to in subsection (1) or (2), other than one described in subsection (2.1), requires the approval of the Superintendent under the Bank Act, the Cooperative Credit Associations Act, the Insurance Companies Act or the Trust and Loan Companies Act, that approval is not required despite those Acts but the transaction has no force or effect until the Minister approves it after consultation with the Superintendent.ConversionAn order made under paragraph 39.13(1)(d) gives the Corporation the power to convert, or cause the federal member institution to convert, in whole or in part — by means of a transaction or series of transactions and in one or more steps — the institution’s shares and liabilities that are prescribed by the regulations made under subsection (10) into common shares of that institution or of any of its affiliates.Terms and conditionsSubject to any regulations made under subsection (10) and any by-laws made under subsection (12), the Corporation shall set the terms and conditions of the conversion, including its timing.PublicationAs soon as feasible after the conversion, the Corporation shall cause a notice of it to be published in the Canada Gazette and on the federal member institution’s website.Completion of transactionIf the Corporation considers that a transaction or series of transactions referred to in this section has been substantially completed and that no other such transactions are expected in respect of the federal member institution, it shall cause a notice to that effect to be published in the Canada Gazetteand on the institution’s website. The notice must specify the date on which the notice is to take effect.Negative pledges inapplicableNo restriction on the rights of the federal member institution, including the right to amalgamate, to sell or otherwise dispose of any of its assets or to provide for the assumption of any of its liabilities, other than a restriction provided for in an Act of Parliament, applies so as to prevent the Corporation, the federal member institution or any other person from carrying out a transaction referred to in this section.[Repealed, 2016, c. 7, s. 139]NovationAny person who assumes a liability of the federal member institution under a transaction referred to in subsection (1) or (2) becomes liable — instead of the federal member institution — to discharge the liability, on approval of the transaction by the Minister or as soon as the person assumes the liability if the transaction does not require the Minister’s approval.ExceptionSubsection (6) does not apply to the bridge institution’s assumption of any portion of the federal member institution’s liability that is not insured by the Corporation.Novation — trustA trust company within the meaning of subsection 57(2) of the Trust and Loan Companies Act that is designated as a bridge institution may become a trustee in substitution for the federal member institution without formality or the consent of any beneficiary of the trust.Effects of conversionThe conversion of shares or liabilities under subsection (2.3)subject to paragraphs (b) and (c), extinguishes any claim, interest or right in respect of the shares or liabilities, or part of them, that were converted;does not extinguish any claim to the extent that the claim is a personal claim against a person other than the Corporation, the federal member institution or a person claiming under the Corporation or the federal member institution; anddoes not prevent a secured creditor or an assignee or successor in interest of the person who was the holder of the shares or liabilities immediately before the conversion from being entitled to receive compensation under section 39.23.RegulationsThe Governor in Council may make regulations respecting conversion for the purposes of this section.Regulations — applicationRegulations made under subsection (10) may, if they so provide, apply in respect of shares and liabilitiesthat were issued or that originated before the day on which the first regulation made under that subsection comes into force if, on or after that day, they are amended or, in the case of liabilities, their term is extended; orthat are issued or that originate on or after that day.By-lawsThe Corporation may make by-laws respecting conversion for the purposes of this section, including by-laws that prescribe, for the purposes of subsection (2.3), the interim instruments into which shares and liabilities may be converted before they are converted into common shares.InconsistencyIn the event of any inconsistency between the regulations made under subsection (10) and the by-laws made under subsection (12), the regulations prevail to the extent of the inconsistency.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2009, c. 2, s. 247; 2016, c. 7, s. 139
Terms and conditions of transactionsIf the Corporation as receiver for a federal member institution carries out a transaction with a bridge institution, the Corporation shall establish the terms and conditions of the transaction, includingwhich assets the bridge institution shall acquire and the consideration to be paid for the assets acquired; andwhich liabilities the bridge institution shall assume and the consideration to be paid for the liabilities assumed.Reasonable considerationThe consideration referred to in paragraph (1)(a) shall be reasonable in the circumstances.[Repealed, 2016, c. 7, s. 140]2009, c. 2, s. 248; 2016, c. 7, s. 140
Deposit liabilities assumedA bridge institution shall assume a federal member institution’s deposit liabilities that are both insured by the Corporation and posted in the federal member institution’s records as of the date and time specified in the order referred to in paragraph 39.13(1)(c).InterestAny interest accrued on the deposit liabilities referred to in subsection (1) is assumed by the bridge institution.Deeming deposits or withdrawals not enteredAny deposit or withdrawal that is made on or before that date and time but is not posted in the records of the federal member institution as of that date and time, and any deposit or withdrawal made after that date and time, are deemed to be deposited with or withdrawn from, as the case may be, the bridge institution.InterestAny interest accruing on the deposits referred to in subsection (1.2) is owed by the bridge institution.SubrogationIf the bridge institution assumes any portion of a federal member institution’s liability that is not insured by the Corporation, the bridge institution is subrogated to all the rights and interests of the creditor against the federal member institution in relation to the entire liability and may maintain an action in respect of those rights and interests in its own name or in the name of the creditor.Creditor’s rights and interestsAs soon as the bridge institution receives an amount equal to the liabilities that are not insured by the Corporation that it assumed, the rights and interests in respect of the balance remaining revert to the creditor.2009, c. 2, s. 248; 2010, c. 12, s. 1891
Liquidator boundThe liquidator of a federal member institution appointed under the Winding-up and Restructuring Act is bound by the terms and conditions of any transaction that involves the sale or other disposition of the federal member institution’s assets or the assumption by a bridge institution of any portion of the federal member institution’s liabilities and shall carry out those transactions or cause them to be carried out.ExpensesAll costs, charges and expenses properly incurred by the liquidator in complying with the terms and conditions of any transaction referred to in subsection (1), including the liquidator’s remuneration, are payable by the bridge institution.2009, c. 2, s. 248
Right transferableIf the assets that are sold under a transaction described in section 39.2 or by a bank designated as a bridge institution include any outstanding security under section 426 or 427 of the Bank Act, the buyer of the assets may hold the security for the life of the loan to which the security relates and all the provisions of that Act relating to the security and its enforcement continue to apply to the buyer as though the buyer were a bank.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2009, c. 2, s. 249
Winding-upThe Corporation shall apply for a winding-up order in respect of a federal member institution under the Winding-up and Restructuring Act if a notice has not been published under subsection 39.2(3) in respect of the institution on or beforethe day that is 12 months after the day on which the order is made under subsection 39.13(1); orthe day on which any extension of that period ends.Winding-up — certain casesDespite subsection (1), if an order is made under paragraph 39.13(1)(d) or subsection 39.13(1.3) in respect of the institution, the Corporation shall apply for a winding-up order in respect of the institution under the Winding-up and Restructuring Act if a notice has not been published under subsection 39.2(3) in respect of the institution on or beforethe day that is one year after the day on which the order is made under subsection 39.13(1) or any shorter period specified in the order made under paragraph 39.13(1)(d) or subsection 39.13(1.3), as the case may be; orthe day on which any extension of the applicable period ends.DeemingFor the purposes of the Winding-up and Restructuring Act, the Corporation is deemed to be a creditor of the federal member institution.ExtensionThe Governor in Council may, by order made on the recommendation of the Minister, grant one or more extensions of the period set out in subsection (1) but the last extension must expire not later than the day that is 18 months after the day on which the order is made under subsection 39.13(1).Extension — certain casesThe Governor in Council may, by order made on the recommendation of the Minister, grant one or more extensions of the applicable period set out in subsection (1.1) — of up to one year each — but the last extension must expire not later than five years after the day on which the order is made under subsection 39.13(1).1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 1412021, c. 23, s. 127
Compensation
Amount of compensationIf an order is made under subsection 39.13(1), the Corporation shall, in accordance with the regulations and the by-laws, determine the amount of compensation, if any, to be paid to a prescribed person.Persons entitled to compensationOnly a prescribed person who is, as a result of the application of the regulations, in a worse financial position than they would have been had the federal member institution been liquidated under the Winding-up and Restructuring Act is entitled to be paid compensation.Duty to pay compensationThe Corporation shall pay the compensation and shall decide whether to pay it wholly or partly in cash or wholly or partly in any other form, including shares, that the Corporation considers appropriate.Determining amount — no comparison with othersIn determining the amount of compensation to which a person is entitled, the following shall not be taken into account:any shares or other interest or right received by another person as a result of an order made under subsection 39.13(1) or retained by another person; andany common shares received by another person as a result of a conversion of shares or liabilities in accordance with the contractual terms of those shares or liabilities.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 1422021, c. 23, s. 128
Decision conclusiveExcept as otherwise provided in this Act, a decision made by the Corporation under section 39.23 or by an assessor appointed under section 39.26 is for all purposes final and conclusive and shall not be questioned or reviewed in any court.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2009, c. 2, s. 250; 2016, c. 7, s. 142
[Repealed, 1996, c. 6, s. 41]
Discharge of liabilityPayment of the compensation by the Corporation under section 39.23 discharges the Corporation from its obligations under that section and in no case is the Corporation under any obligation to see to the proper application in any way of any such payment.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 142
Appointment of assessorIn the circumstances prescribed by the regulations, the Governor in Council shall, by order, appoint as assessor a judge who is in receipt of a salary under the Judges Act to review a decision made by the Corporation under subsection 39.23(1) and determine the amount of compensation, if any, to be paid to a prescribed person.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 142
Sittings and hearingsAn assessor may sit at any place and shall arrange for the sittings and hearings that may be required.Powers of assessorThe assessor has all the powers conferred on a commissioner appointed under Part II of the Inquiries Act for the purpose of obtaining evidence under oath.Persons to assistAn assessor may appoint a person to assist him or her in performing his or her functions.PaymentFees and disbursements payable to the person may be included by the assessor in an amount awarded in respect of costs under subsection (5) or (6).Costs of prescribed personIf the assessor determines that it is just and reasonable that costs in the proceeding before the assessor be awarded to a prescribed person and against the Corporation, the amount that the assessor determines to be just and reasonable to award in respect of those costs is payable by the Corporation to the prescribed person.Costs of CorporationIf the assessor determines that it is just and reasonable that costs in the proceeding before the assessor be awarded to the Corporation and against a prescribed person, the amount that the assessor determines to be just and reasonable to award in respect of those costs constitutes a debt payable by the prescribed person to the Corporation and may be recovered as such in any court of competent jurisdiction.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 142
RegulationsThe Governor in Council may make regulations respecting compensation for the purposes of sections 39.23 to 39.27, including regulationsprescribing persons referred to in subsection 39.23(1);respecting the factors that the Corporation shall or shall not consider in making a decision under subsection 39.23(1);respecting the circumstances in which an assessor must be appointed under section 39.26;respecting the factors that an assessor shall or shall not consider in making a decision; andrespecting procedural requirements.By-lawsThe Corporation may make by-laws respecting compensation for the purposes of section 39.23.InconsistencyIn the event of any inconsistency between the regulations made under subsection (1) and the by-laws made under subsection (2), the regulations prevail to the extent of the inconsistency.1992, c. 26, s. 11; 1996, c. 6, s. 41; 2016, c. 7, s. 142
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
[Repealed, 2016, c. 7, s. 142]
Creation and Operation of Bridge Institutions
IncorporationThe Minister shall, without delay after an order is made under paragraph 39.13(1)(c), issue letters patent incorporating a federal institution.Incorporating ActThe letters patent are issued under whichever of the following Acts regulates the federal member institution that is the subject of the Superintendent’s report under subsection 39.1(1) or (3):the Bank Act;the Cooperative Credit Associations Act; orthe Trust and Loan Companies Act.Order to commence and carry on businessThe Superintendent shall, without delay after the letters patent are issued, make an order approving the commencement and carrying on of business by the federal institution referred to in subsection (1).Content of Superintendent’s order — limitationThe Superintendent’s order shall not prohibit the federal institution, during the period that it is designated as a bridge institution, from accepting deposits in Canada and shall not make the federal institution, during that period, subject to subsection 413(3) of the Bank Act, subsection 378.1(2) of the Cooperative Credit Associations Act or subsection 413(2) of the Trust and Loan Companies Act.2009, c. 2, s. 251
DurationSubject to section 39.3715, the federal institution referred to in subsection 39.371(1) is designated as a bridge institution for a period of two years.ExtensionsThe Governor in Council may, by order, on the recommendation of the Minister, grant up to three extensions — of one year each — of the period referred to in subsection (1).2009, c. 2, s. 251
[Repealed, 2016, c. 7, s. 143]
Financial assistanceThe Corporation shall provide the financial assistance that a bridge institution needs in order to discharge its obligations, except for its obligations to the Corporation, as they become due.2009, c. 2, s. 251
Shares held by CorporationThe Corporation may hold shares in a bridge institution only if the Corporation is the sole shareholder.2009, c. 2, s. 251
Termination of designationA federal institution’s designation as a bridge institution terminates ifthe Corporation is no longer the sole shareholder; orthe federal institution is amalgamated with a body corporate that is not a bridge institution.2009, c. 2, s. 251
Mandatory dissolution of bridge institutionIf a bridge institution’s designation has not terminated under section 39.3715, the federal institution’s board of directors shall take all necessary steps to dissolve the federal institution ifall or substantially all of the federal institution’s assets have been sold or otherwise disposed of; andall or substantially all of its liabilities have been assumed or discharged.2009, c. 2, s. 251
Winding-up of federal member institutionIf the Corporation considers that substantially all of the transfers of assets and liabilities of a federal member institution to a bridge institution have been substantially completed, the Corporation shall apply for a winding-up order under the Winding-up and Restructuring Act in respect of the federal member institution.CreditorFor the purposes of the Winding-up and Restructuring Act, the Corporation is deemed to be a creditor of the federal member institution.ExceptionIf the Superintendent has taken control of the federal member institution or its assets and has requested the Attorney General of Canada to apply for a winding-up order or informs the Corporation that he or she intends to request that the Attorney General of Canada apply for that order, the Corporation is not required to apply for a winding-up order.2009, c. 2, s. 251
Power of the CorporationThe Corporation may hold any federal institution’s shares that the Corporation acquires in the course of a sale or other disposition of its shares of the bridge institution or that a bridge institution acquires in the course of a sale or other disposition of its assets.Maximum periodThe Corporation may hold the shares for a period of no more than five years from the day on which they are acquired and may dispose of them.ExtensionThe Minister may, by order, extend the period referred to in subsection (2) if general market conditions so warrant.Provisions inapplicableThe following provisions do not apply with respect to the shares referred to in subsection (1):sections 401.2 and 401.3 of the Bank Act;sections 428 and 430 of the Insurance Companies Act; andsections 396 and 399 of the Trust and Loan Companies Act.2009, c. 2, s. 251
Remuneration and benefitsAn employee or officer of the Corporation shall not receive remuneration or benefits from a bridge institution for being a director or officer of that institution.2009, c. 2, s. 251
Non-liability with respect to employeesIf a bridge institution becomes the employer of employees of a federal member institution, the bridge institution is not liable in respect of a liability, including one as a successor employer,that is in respect of the employees or former employees of the federal member institution or a predecessor of the federal member institution or in respect of a pension plan for the benefit of those employees or former employees; andthat exists before the bridge institution becomes the employer or that is calculated by reference to a period before the bridge institution becomes the employer.Liability of other successor employersSubsection (1) does not affect the liability of a successor employer other than the bridge institution.2009, c. 2, s. 251; 2012, c. 5, s. 201
Corporation’s directionsThe Corporation may give directions to the board of directors of a bridge institution.ImplementationThe board of directors of the bridge institution shall ensure that the directions are implemented in a prompt and efficient manner and shall, after implementing a direction, notify the Corporation without delay that it has been implemented.2009, c. 2, s. 251; 2016, c. 7, s. 144
By-laws — CorporationThe Corporation may give directions to the board of directors of a bridge institution to make, amend or repeal any by-law.By-laws — board of directorsThe board of directors of a bridge institution may, with the prior approval of the Corporation, make, amend or repeal any by-law.Meaning of by-lawFor the purposes of subsections (1) and (2), by-law means a by-law of the bridge institution.2009, c. 2, s. 251; 2016, c. 7, s. 145
[Repealed, 2016, c. 7, s. 146]
Restructuring of Provincial Member Institutions
Federal-provincial agreementsThe Minister may, with the approval of the Governor in Council, enter into an agreement with an appropriate provincial minister providing for the application of any of sections 39.1 to 39.28 to provincial member institutions incorporated under the laws of that province.OrdersIf an agreement has been entered into with an appropriate provincial minister, the Governor in Council may make orders, which are to be consistent with the agreement, providing for the application of any of sections 39.1 to 39.28 to provincial member institutions incorporated under the laws of that province and adapting any of the provisions of those sections in their application to those provincial member institutions.1996, c. 6, s. 41; 2016, c. 7, s. 147
Financial
Financial yearThe financial year of the Corporation shall end on December 31 in each year unless the Governor in Council otherwise directs.R.S., c. C-3, s. 34; 1984, c. 31, s. 14
Deposit accountsThe Corporation may maintain in its own name one or more accountswith the Bank of Canada;with any member institution; andwith the approval of the Minister, with any financial institution outside Canada.R.S., 1985, c. C-3, s. 41; R.S., 1985, c. 18 (3rd Supp.), s. 65
Interest may be paidThe Bank of Canada may pay interest on any money that the Corporation deposits with it.R.S., 1985, c. C-3, s. 42; 1985, c. 18 (3rd Supp.), s. 66; 1992, c. 26, s. 12; 1996, c. 6, s. 42; 2014, c. 20, s. 109
AuditorThe Auditor General of Canada is the auditor of the Corporation.R.S., c. C-3, s. 38; 1976-77, c. 34, s. 30(F); 1984, c. 31, s. 14
Staff
Employment of staffThe Corporation may, notwithstanding any other Act, employ such officers, agents and employees as are necessary for the purposes of the Corporation and, subject to section 45, the officers, agents and employees of the Corporation shall be deemed not to be employed in the federal public administration.Oath of fidelity and secrecyEach officer, agent or employee of the Corporation shall, before entering on his or her duties with the Corporation, take an oath of fidelity and secrecy in the form prescribed by the by-laws.Use of departmental facilitiesIn carrying out its functions under this Act, the Corporation may, with the approval of the Minister, make use of the personnel, facilities and services of the Office of the Superintendent of Financial Institutions and the Department of Finance to any extent not incompatible, in the opinion of the Minister, with the administration of that Office or Department.R.S., 1985, c. C-3, s. 44; R.S., 1985, c. 18 (3rd Supp.), s. 67; 2003, c. 22, s. 224(E); 2012, c. 5, s. 206(E)
Public Service Superannuation ActThe officers and employees of the Corporation shall be deemed to be employed in the public service for the purposes of the Public Service Superannuation Act and the Corporation shall be deemed to be a Public Service corporation for the purposes of section 37 of that Act.Application of other ActsFor the purposes of the Government Employees Compensation Act and any regulation made pursuant to section 9 of the Aeronautics Act, the Chairperson and employees of the Corporation shall be deemed to be employees in the federal public administration.SuperannuationThe Public Service Superannuation Act does not apply to the Chairperson, unless the Governor in Council otherwise directs, or to the director of the Corporation who holds the office of Governor of the Bank of Canada.R.S., 1985, c. C-3, s. 45; 1996, c. 6, s. 47(E); 2003, c. 22, ss. 224(E), 225(E)
No Liability
No liability for acts in good faithHer Majesty in right of Canada, any servant or agent of Her Majesty, the Corporation, its directors, officers and employees and any person acting on behalf of the Corporation are not liable to any member institution, depositor with, or creditor or shareholder of, any member institution, or to any other person, for any damages, payment, compensation, contribution or indemnity that any such member institution, depositor, creditor, shareholder or other person may suffer or claim by reason of anything done or omitted to be done, in good faith, in the exercise, execution or performance — or the purported exercise, execution or performance — of any powers, duties and functions under this Act.Obligation remainsNothing in subsection (1) shall be construed to relieve the Corporation from the obligation to make payment in respect of a deposit insured under this Act or to pay compensation under section 39.23.R.S., 1985, c. 18 (3rd Supp.), s. 68; 2016, c. 7, s. 148
Directors and officers of institutionsDirectors and officers of a federal member institution in respect of which an order is made under paragraph 39.13(1)(a) or (b) or of a bridge institution are not liable for any damages, payment, compensation, contribution or indemnity that any person may suffer or claim by reason of anything done or omitted to be done during the period set out in subsection (3), in good faith, in the exercise, execution or performance of any powers, duties and functions as directors or officers of the institution.IndemnificationSection 119 of the Financial Administration Act and the regulations made under that section apply to the directors and officers referred to in subsection (1) in respect of anything done or omitted to be done in the exercise, execution or performance of their powers, duties and functions during the period set out in subsection (3), as if the federal member institution or the bridge institution were a Crown corporation within the meaning of section 83 of that Act.Time periodThe period referred to in subsections (1) and (2) begins on the day on which the order is made under subsection 39.13(1) and endson the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution;on the day on which the bridge institution ceases to be designated as such; oron the day on which a winding-up order is made in respect of the federal member institution or the bridge institution.2009, c. 2, s. 252; 2016, c. 7, s. 149
Foreign relief — no recognition or enforcementExcept with the consent of the Attorney General of Canada, no judgment, order or other relief given in a proceeding outside Canada in respect of an order made under subsection 39.13(1) shall be recognized or enforceable in any manner in Canada.No proceedingsExcept with the consent of the Attorney General of Canada, no proceedings shall be commenced in any court in Canada in respect of the judgment, order or other relief given outside Canada.2016, c. 7, s. 149
Confidentiality
ConfidentialityAll information regarding the affairs of a federal institution, provincial institution or local cooperative credit society, or of any person dealing with one, that is obtained or produced by or for the Corporation is confidential and shall be treated accordingly.Information to Governor of the Bank of CanadaThe Corporation may, if it is satisfied that the information will be treated as confidential by the Governor of the Bank of Canada or any officer of the Bank of Canada authorized in writing by the Governor of the Bank of Canada, disclose any information referred to in subsection (1) to the Governor or the designated officer for the purpose of carrying out the Bank of Canada’s objects under the Retail Payment Activities Act or, in relation to any provisions of that Act that are not in force, for the purpose of planning to carry out those objects.Information from the SuperintendentThe Corporation may, if it is satisfied that the information will be treated as confidential by the recipient and after consultation with the Superintendent, disclose any information obtained from the Superintendent regarding the affairs of a federal member institutionto any government agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision;to any other agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision; orto any deposit insurer or any compensation association for purposes related to its operation.Information respecting nominee brokersThe Corporation may, if it is satisfied that the information will be treated as confidential by the recipient, disclose information that is obtained by it — or is produced by or for it — respecting the non-compliance of a nominee broker with section 7 of the schedule toany government agency or body that regulates or supervises nominee brokers, for purposes related to that regulation or supervision; orany other agency or body that regulates or supervises nominee brokers, for purposes related to that regulation or supervision.Making information publicDespite subsection (1), for the purpose of protecting the interests and rights of beneficiaries of nominee broker deposits, the Corporation may make information referred to in subsection (3) available to the public in a manner that it considers advisable.R.S., 1985, c. 18 (3rd Supp.), s. 68; 1996, c. 6, s. 43; 2001, c. 9, s. 214; 2010, c. 12, s. 2104; 2012, c. 5, ss. 203, 2232018, c. 12, s. 2072021, c. 23, s. 178
Disclosures prohibitedSubject to subsection 12(1) of the Privacy Act, any information with respect to the affairs of a federal member institution in respect of which an order is made under paragraph 39.13(1)(a) or (b), a bridge institution, a subsidiary of either of those institutions or any person dealing with such an institution or subsidiary is confidential, shall be treated accordingly and shall not be disclosed.Duration of prohibitionThe prohibition applies only during the period set out in subsection 45.11(3).Exception — entity or personThe prohibition does not apply if the information is disclosedto any government agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision;to any other agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision;to the Financial Transactions and Reports Analysis Centre of Canada established by section 41 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, for the purpose of complying with that Act;to the Corporation for the purposes of fulfilling its functions under this Act or as a shareholder of the federal member institution or the bridge institution;to the Minister of Finance, the Deputy Minister of Finance or any officer of the Department of Finance authorized in writing by the Deputy Minister of Finance;to the Governor of the Bank of Canada or any officer of the Bank of Canada authorized in writing by the Governor of the Bank of Canada, for the purposes of policy analysis related to the regulation of financial institutions, for the purpose of carrying out the Bank of Canada’s objects under the Retail Payment Activities Act or, in relation to any provisions of that Act that are not in force, for the purpose of planning to carry out those objects;to the Canada Revenue Agency solely for the purpose of the Income Tax Act or the Excise Tax Act; orto any other entity or person that is prescribed by regulation, in any circumstance or condition prescribed by regulation.Other exceptionsThe prohibition does not apply if the information is disclosedin the normal conduct of the business of the federal member institution, the bridge institution or a subsidiary of either of those institutions;for the purposes of selling the shares or assets of the federal member institution, the bridge institution or a subsidiary of either of those institutions;for the purpose of any legal proceedings;for the purpose of preparing the Corporation’s annual report and its corporate plan or if the information is disclosed in those documents;in any circumstance that is prescribed by regulation; orin any other circumstance that the board of directors of the federal member institution, the bridge institution or a subsidiary of either of those institutions considers necessary.RegulationsThe Governor in Council may make regulationsspecifying the circumstances in which the prohibition does not apply; orspecifying, for the purpose of paragraph (3)(h), the entity to which or person to whom information may be disclosed and the circumstances and conditions under which the information may be disclosed to that entity or person.2009, c. 2, s. 253; 2016, c. 7, s. 1502021, c. 23, s. 179
Winding-up
Insolvency and winding-upNo statute relating to the insolvency or winding-up of any corporation applies to the Corporation and in no case shall the affairs of the Corporation be wound up unless Parliament so provides.R.S., 1985, c. C-3, s. 46; 2007, c. 6, s. 420(E)
Enforcement Provisions
False statementsA person is guilty of an offence if the person prepares, signs, approves or concurs in any account, statement, return, report or other document required to be submitted to the Corporation under the provisions of this Act, the regulations or the by-laws or under an application to become a member institution or a policy of deposit insurance thatcontains any false or deceptive information; orfails to present fairly information required to be submitted to the Corporation.R.S., 1985, c. C-3, s. 47; 1996, c. 6, s. 45; 2001, c. 9, s. 215; 2016, c. 7, s. 151
Failure to make report knownA person who, being a chief executive officer or chairperson of the board of directors of a member institution, fails or neglects to present, as required by section 30, a report of the Corporation made under that section is guilty of an offence and, if the directors fail or neglect to incorporate that report in the minutes of a meeting of the directors as required by that section, each director present at that meeting who directed, authorized, assented to, acquiesced in or participated in the failure or neglect, is guilty of an offence.R.S., 1985, c. C-3, s. 48; R.S., 1985, c. 18 (3rd Supp.), s. 69; 1996, c. 6, s. 45
Failure to provide information, etc.A member institution is guilty of an offence if it fails or neglectswithin the time limited for so doing, to provide the Corporation with any account, statement, return, report or other document respecting the affairs of the member institution that is required to be submitted to the Corporation under the provisions of this Act, the regulations or the by-laws or under the policy of deposit insurance of the member institution; orto respond, within a reasonable time, to a request for information or explanations respecting the member institution made by or on behalf of the Corporation under the provisions of this Act, the regulations or the by-laws or under the policy of deposit insurance of the member institution.R.S., 1985, c. C-3, s. 49; 1996, c. 6, s. 45; 2016, c. 7, s. 152
General offenceA member institution or other person is guilty of an offence if they, without reasonable cause, contravene a provision of this Act, other than section 47, 48 or 49, or a provision of the regulations or the by-laws.R.S., 1985, c. C-3, s. 50; R.S., 1985, c. 18 (3rd Supp.), s. 70; 1996, c. 6, s. 45; 2016, c. 7, s. 153
PunishmentEvery member institution or other person who commits an offence under this Act is liable on summary convictionin the case of a natural person, to a fine not exceeding $100,000 or to imprisonment for a term not exceeding twelve months, or to both; orin any other case, to a fine not exceeding $500,000.1996, c. 6, s. 45
Court may order complianceIf a member institution or other person has been convicted of an offence under this Act, the court may, in addition to any fine or term of imprisonment that may be imposed, order the member institution or person to rectify the contravention of a provision of this Act, the regulations or the by-laws or the policy of deposit insurance in respect of which the member institution or person was convicted.R.S., 1985, c. C-3, s. 51; R.S., 1985, c. 18 (3rd Supp.), s. 71; 1996, c. 6, s. 45; 2016, c. 7, s. 154
Additional monetary punishmentWhere a member institution or other person has been convicted of an offence under this Act, the court may, where it is satisfied that as a result of the commission of the offence the convicted member institution or person acquired a monetary benefit or that a monetary benefit accrued to the benefit of the member institution or person, order the convicted member institution or person to pay, notwithstanding the maximum amount of any fine that may otherwise be imposed under this Act, an additional fine in an amount equal to the court’s estimation of the amount of the monetary benefit.Restraining or compliance orderIf a member institution or other person does not comply with any provision of this Act, the regulations or the by-laws or the policy of deposit insurance that applies in respect of the member institution or person, the Corporation may apply to a superior court for an order directing the member institution or person to comply with or restraining the member institution or person from acting in breach of the provision or the policy and, on the application, the court may so order and make any further order that it thinks fit.R.S., 1985, c. C-3, s. 52; R.S., 1985, c. 18 (3rd Supp.), s. 71; 1996, c. 6, s. 45; 2016, c. 7, s. 155
AppealsAny decision or order of a court that tries an issue under this Act may be appealed to the court having jurisdiction to hear appeals from that trial court.R.S., 1985, c. 18 (3rd Supp.), s. 71; 1996, c. 6, s. 45
Recovery and application of finesAll fines payable under this Act are recoverable and enforceable, with costs, at the suit of Her Majesty in right of Canada, instituted by the Attorney General of Canada and, when recovered, belong to Her Majesty in right of Canada.1996, c. 6, s. 45
(Section 2, subsections 11(2.1), 12.1(2) and (3) and 14(1.01), sections 25.4 and 26.01 and subsection 45.2(3))Interpretation
DefinitionsIn this schedule,date of deposit means, with respect to any moneys constituting a deposit, the day on which credit for the moneys is given to the account of the depositor or the day on which an instrument is issued for the moneys by the institution, as the case may be; (date du dépôt)depositor means a person whose account has been or is to be credited in respect of moneys constituting a deposit or part of a deposit or a person to whom a member institution is liable in respect of an instrument issued for moneys constituting a deposit or part of a deposit; (déposant)loan company means a member institution to which the Trust and Loan Companies Act applies and that is not a trust company pursuant to subsection 57(2) of that Act; (société de prêt)patronage allocation has the same meaning as in section 2 of the Bank Act; (ristourne)person includes an association of persons and a government; (personne)registered disability savings plan has the same meaning as in subsection 146.4(1) of the Income Tax Act; (régime enregistré d’épargne-invalidité) registered education savings plan has the same meaning as in subsection 146.1(1) of the Income Tax Act; (régime enregistré d’épargne-études)subordinated note[Repealed, 2007, c. 6, s. 421]subordinated shareholder loan[Repealed, 2007, c. 6, s. 421]trust company means a member institution to which the Trust and Loan Companies Act applies and that is a trust company pursuant to subsection 57(2) of that Act. (société de fiducie)
Definition of depositSubject to subsection (2), for the purposes of this Act and the by-laws of the Canada Deposit Insurance Corporation, deposit means the unpaid balance of the aggregate of moneys received or held by a federal institution, provincial institution or local cooperative credit society, from or on behalf of a person in the usual course of the deposit-taking business of the institution, for which the institutionhas given or is obligated to give credit to that person’s account or has issued or is obligated to issue a receipt, certificate, debenture (other than a debenture issued by a bank to which the Bank Act applies), transferable instrument, draft, certified draft or cheque, prepaid letter of credit, money order or other instrument in respect of which the institution is primarily liable, andis obligated to repay the moneys on a fixed day, on demand by that person or within a specified period of time following demand by that person,including any interest accrued or payable to that person.Included moneysFor greater certainty, an unpaid balance of moneys received or held by an institution from or on behalf of a mortgagor in respect of realty taxes on mortgaged property is a deposit. The moneys are considered to be repayable on the earlier of the due date of the taxes or the date the mortgage is discharged.Included moneysFor greater certainty, moneys are considered to be a deposit or part of a deposit if they are paid in respect of a deposit that is held in a registered education savings plan or registered disability savings plan under or because ofthe Canada Education Savings Act or a designated provincial program as defined in subsection 146.1(1) of the Income Tax Act;any other program that has a similar purpose to a designated provincial program referred to in paragraph (a) and that is funded, directly or indirectly, by a province;the Canada Disability Savings Act or a designated provincial program as defined in subsection 146.4(1) of the Income Tax Act; orany other program that has a similar purpose to a designated provincial program referred to in paragraph (c) and that is funded, directly or indirectly, by a province.Excluded moneysMoneys held by the institution that were received by it when it was not a federal institution, a provincial institution or a local cooperative credit society are excluded from the moneys referred to in subsection (1).[Repealed, 2018, c. 12, s. 211][Repealed, 2018, c. 12, s. 211]Obligation deemedFor the purposes of subsection (1), if a trust company has deposited moneys in its own guaranteed trust fund on behalf of itself as trustee, it shall be deemed to be obligated to repay the moneys to the same extent as it would have been obligated to repay the moneys had the moneys been deposited by a trustee other than itself.[Repealed, 2001, c. 9, s. 216]Moneys received on or after April 1, 1977Despite subsection (1), for the purposes of deposit insurance with the Corporation, if moneys are or were received by a member institution on or after April 1, 1977 for which the institution has issued or is obligated to issue an instrument evidencing a deposit, other than a draft, certified draft or cheque, prepaid letter of credit or money order,the moneys do not constitute a deposit unless the instrument and records of the institution specify the person entitled, at the date of issue of the instrument, to the repayment of the moneys evidenced thereby;the person referred to in paragraph (a) shall be deemed to be the depositor in respect of the moneys unless particulars of a transfer of the instrument are entered in the records of the institution, in which case the most recent transferee shown in the records shall be deemed to be the depositor; andthe entry of a transfer in the records of a member institution is ineffective for the purposes of paragraph (b), if the entry is made subsequent to the termination or cancellation of the policy of deposit insurance of the member institution.Moneys received on or after January 1, 1977Despite subsection (1), moneys received by a member institution on or after January 1, 1977, for which the institution has issued or is obligated to issue an instrument of indebtedness, other than a draft, certified draft or cheque, prepaid letter of credit or money order, do not constitute a deposit where the instrument is payable outside Canada.Patronage allocationA patronage allocation does not constitute a deposit.
Not part of depositIf a member institution is obligated to repay to a person any moneys that are received or held by the institution and the date on which the person acquires their interest or right in the moneys is a date subsequent to the date on which the policy of deposit insurance of the member institution is terminated or cancelled, the amount of the moneys is considered not to constitute part of a deposit for the purposes of deposit insurance with the Corporation.
Co-ownership of Deposits
Co-owned depositsIf a member institution is obligated to repay moneys to a depositor who is acting as a co-owner with another person and the co-ownership is disclosed on the records of the member institution, in accordance with the by-laws, the deposit of the depositor is, for the purposes of deposit insurance with the Corporation, considered to be a deposit separate from any deposit of the depositor acting in their own right, in a trust capacity or in another co-ownership capacity with the member institution.Co-ownershipFor greater certainty, if two or more persons are co-owners of two or more deposits, the aggregate of those deposits shall be insured to a maximum of one hundred thousand dollars.
Deferred or Other Special Income Arrangements
Registered retirement savings plansDespite subsection 6(2), for the purposes of deposit insurance with the Corporation, if moneys that constitute a deposit or part of a deposit are received by a member institution from a depositor in accordance with a registered retirement savings plan, as defined in subsection 146(1) of the Income Tax Act, and the plan is for the benefit of an individual, then the aggregate of those moneys and any other moneys received from that depositor in accordance with any other registered retirement savings plan that constitute a deposit or part of a deposit for the benefit of that individual is considered to be a single deposit separate from any other deposit for the benefit of that individual.Registered retirement income fundsDespite subsection 6(2), for the purposes of deposit insurance with the Corporation, if moneys that constitute a deposit or part of a deposit are received by a member institution from a depositor under a registered retirement income fund, as defined in subsection 146.3(1) of the Income Tax Act, and the plan is for the benefit of an individual, then the aggregate of those moneys and any other moneys that constitute a deposit or part of a deposit received from that depositor under any other registered retirement income fund that is for the benefit of that individual, is considered to be a single deposit separate from any other deposit for the benefit of that individual.Tax-free savings accountsDespite subsection 6(2), for the purposes of deposit insurance with the Corporation, if moneys that constitute a deposit or part of a deposit are received by a member institution from a depositor under a tax-free savings account, within the meaning assigned by section 146.2 of the Income Tax Act, and the account is for the benefit of an individual, then the aggregate of those moneys and any other moneys that constitute a deposit or part of a deposit received from that depositor under any other tax-free savings account that is for the benefit of that individual is considered to be a single deposit separate from any other deposit for the benefit of that individual.First home savings accountDespite subsection 6(2), for the purposes of deposit insurance with the Corporation, if moneys that constitute a deposit or part of a deposit are received by a member institution from a depositor under a first home savings account as defined in subsection 248(1) of the Income Tax Act, and the account is for the benefit of an individual, then the aggregate of those moneys and any other moneys that constitute a deposit or part of a deposit received from that depositor under any other first home savings account that is for the benefit of that individual is considered to be a single deposit separate from any other deposit for the benefit of that individual.Registered education savings plansDespite subsection 6(2), for the purposes of deposit insurance with the Corporation, if moneys that constitute a deposit or part of a deposit are received by a member institution from a depositor under a registered education savings plan that is for the benefit of an individual, then the aggregate of those moneys and any other moneys that constitute a deposit received from that depositor under any other registered education savings plan that is for the benefit of that individual is considered to be a single deposit separate from any other deposit for the benefit of that individual.Registered disability savings plansDespite subsection 6(2), for the purposes of deposit insurance with the Corporation, if moneys that constitute a deposit are received by a member institution from a depositor under a registered disability savings plan that is for the benefit of an individual, then the aggregate of those moneys and any other moneys that constitute a deposit or part of a deposit received from the same depositor under any other registered disability savings plan that is for the benefit of that individual is considered to be a single deposit separate from any other deposit for the benefit of that individual.Government moneysFor the purposes of subsections (4) and (5) moneys received by a member institution from a depositor in accordance with a registered education savings plan or a registered disability savings plan are considered to include moneys received from the government of Canada or the government of a province under that plan.
Trust DepositsGeneral
Trust depositsIf a member institution is obligated to repay moneys to a depositor who is acting as a trustee for another person and the trusteeship is disclosed on the records of the member institution, in accordance with the by-laws, the deposit of the depositor is, for the purposes of deposit insurance with the Corporation, considered to be a deposit separate from any deposit of the depositor acting in their own right, in a co-ownership capacity or acting in a trust capacity for another person with the member institution.Separate trust depositIf a member institution is obligated to repay moneys to a depositor who is acting as trustee for a beneficiary and the trusteeship is disclosed on the records of the member institution, in accordance with the by-laws, the interest or right of the beneficiary in the deposit is, for the purposes of deposit insurance with the Corporation, considered to be a deposit separate from any deposit of the beneficiary made with the member institution in their own right for their own use and separate from any interest or right of the beneficiary in respect of any other trust deposit made by another depositor of which the beneficiary is a beneficiary.Deposit of beneficiarySubject to section 10, if a member institution is obligated to repay moneys to a depositor who is acting as trustee for two or more beneficiaries and the interest or right of a beneficiary in the deposit is disclosed on the records of the member institution, in accordance with the by-laws, the interest or right of that beneficiary in the deposit is, for the purposes of deposit insurance with the Corporation, considered to be a separate deposit.Multiple depositsFor greater certainty, if a member institution is obligated to repay moneys to a depositor who is acting as trustee for two or more trusteeships under which the same beneficiary is a beneficiary, the aggregate of the interest or right of that beneficiary in those deposits shall be insured to a maximum of one hundred thousand dollars.Notice to trusteesThe Corporation may, in accordance with the by-laws, require a member institution who is obligated to repay moneys to a depositor who is acting as a trustee for another person to provide the trustee with the information specified by the Corporation.Error or omissionAn error or omission that results in a failure to meet a requirement of this schedule does not prevent a deposit from being considered a separate deposit under subsection (1), (2) or (3) ifthe trustee is aware of the error or omission and has made their best efforts to correct it; orthe trustee is not aware of the error or omission but has exercised due diligence to be in compliance with the requirements of this schedule.
[Repealed, 2021, c. 23, s. 132]
Nominee Broker Deposits
Additional conditionsThe following conditions apply to nominee broker deposits in addition to those set out in section 6:at the time the deposit is made and each time a change is made to the deposit, the nominee broker must provide the following information to the member institution for it to disclose on its recordsthe fact that the deposit is made by a nominee broker,the unique alphanumeric code for each beneficiary of the deposit, assigned in accordance with the by-laws,the amount or percentage of the interest or right of the beneficiary associated with that code, andany other information specified in the by-laws; andthe nominee broker must provide, in accordance with the by-laws, the following to the Corporation, within three business days after the day on which a request is made by the Corporation:each unique alphanumeric code provided under subparagraph (a)(ii),the current name and address of the beneficiary associated with that code, andany other information specified in the by-laws respecting the deposit.Co-ownershipIf two or more persons are co-owners of a deposit, they are, for the purposes of assigning a unique alphanumeric code, considered to be a single beneficiary, separate from any of the persons as a beneficiary — in their own right, in a trust capacity or in another co-ownership capacity — of a deposit made by the same nominee broker with the same member institution.
Member institution requirements — agreements and arrangementsIf a member institution enters into an agreement or arrangement respecting nominee broker deposits, the member institution must ensure that the agreement or arrangement includes provisions that require the nominee brokerto provide information to the Corporation in accordance with paragraph 7(1)(b);to make an initial attestation to the Corporation and updated attestations in accordance with the bylaws that state whether the nominee broker is, or is not, capable of fullfilling the obligations set out in paragraph 7(1)(b); andto provide and update contact information in accordance with the by-laws to the member institution.UpdatesThe member institution must ask the depositor to make an updated attestation under paragraph (1)(b) and to provide updated contact information under paragraph (1)(c) each April.NoticeIf a member institution enters into an agreement or arrangement respecting nominee broker deposits, the member institution must notify the Corporation in accordance with the by-laws.Notice — end of agreement or arrangementIf a member institution that has entered into an agreement or arrangement respecting nominee broker deposits is no longer a party to that agreement or arrangement, the member institution must notify the Corporation in accordance with the by-laws.Failure to comply with paragraph 7(1)(a)If the member institution receives moneys from or holds moneys in a nominee broker deposit and the nominee broker fails to comply with paragraph 7(1)(a), the member institution must, as soon as possible after the failure, provide the nominee broker with the information specified in the by-laws.
Professional Trustee Accounts
Professional trustee accountA member institution must identify an account as a professional trustee account if the depositormakes an attestation, in accordance with the by-laws, stating that they are a professional trustee;provides contact information in accordance with the by-laws; andrequests that the account to be identified as a professional trustee account.
Deposit of beneficiaryIf a deposit referred to in subsection 6(3) is held in an account identified as a professional trustee account, the interest or right of each beneficiary in the deposit does not have to be disclosed on the records of the member institution. However, the interest or right of each beneficiary in the deposit is not, for the purposes of deposit insurance with the Corporation, considered to be a separate deposit unless the depositor meets the conditions set out in section 11.
Additional conditionsIn respect of a deposit held in an account identified as a professional trustee account, the following conditions apply in addition to those set out in subsections 6(1) and (2):the depositor must, in accordance with the by-laws, maintain a record that sets out the current name and address of each beneficiary of a deposit in the account and the amount or percentage of the interest or right of each beneficiary;the depositor must provide, in accordance with the by-laws, information respecting deposits in the account to the Corporation if a request is made by the Corporation; andeach April, the depositor must provide the member institution withan attestation, in accordance with the by-laws, stating that they continue to be a professional trustee,confirmation that the account is to continue to be identified as a professional trustee account, andupdated contact information in accordance with the by-laws.
UpdatesA member institution that has identified an account as a professional trustee account must ask the depositor to carry out the actions referred to in paragraph 11(c) each March.Change of statusA depositor who has requested that the account to be identified as a professional trustee account and who is no longer a professional trustee, must notify the member institution that they are no longer a professional trustee and request that the designation be removed.Designation removedA member institution must remove the designation of an account identified as a professional trustee account ifthe depositor requests that the designation be removed; orthe depositor fails to carry out the actions referred to in paragraph 11(c) by April 30.
Information privilegedFor greater certainty, the provision by a depositor to the Corporation of information respecting deposits held in an account identified as a professional trustee account that is subject to solicitor-client privilege or the professional secrecy of advocates and notaries does not constitute a waiver of the privilege or secrecy.
By-laws
By-lawsFor the purposes of the provisions of this schedule, the Board may make by-lawsrespecting information that is to be disclosed on the records of a member institution in respect of a co-ownership interest, a trusteeship or the interest or right of a beneficiary in a deposit;respecting the assignment of unique alphanumeric codes for beneficiaries of nominee broker deposits;specifying information that is to be disclosed on the records of a member institution in respect of a nominee broker deposit;specifying the information a nominee broker is to provide, and the form and manner in which it is to be provided, under paragraph 7(1)(b);respecting attestations by nominee brokers and professional trustees;respecting contact information referred to in paragraph 8(1)(c) and 9(b) and subparagraph 11(c)(iii);respecting notification requirements for agreements or arrangements respecting nominee broker deposits;specifying information for the purposes of subsection 8(4);respecting records to be maintained under paragraph 11(a);specifying the information a professional trustee is to provide, and the form and manner in which it is to be provided, under paragraph 11(b); andrespecting the provision of information to trustees under subsection 6(5).
R.S., 1985, c. C-3, Sch.; R.S., 1985, c. 18 (3rd Supp.), ss. 72, 73; 1991, c. 45, s. 545; 1996, c. 6, ss. 45.1, 46; 1999, c. 28, ss. 108, 109; 2001, c. 9, s. 216; 2005, c. 30, s. 108; 2007, c. 6, s. 421; 2009, c. 2, s. 254; 2010, c. 12, ss. 1892, 2105 to 2107; 2012, c. 5, ss. 204(E), 205(E)2018, c. 12, s. 2082018, c. 12, s. 2092018, c. 12, s. 2102018, c. 12, s. 2112018, c. 12, s. 2122021, c. 23, s. 1322021, c. 23, s. 1382022, c. 19, s. 59RELATED PROVISIONS — 1992, c. 26, s. 14
Existing security interestsParagraphs 39.15(1)(b) to (d) and subsection 39.15(2) of the said Act do not apply in respect of a remedy under, or a stipulation of, a security agreement creating a security interest in property of a federal member institution if the security interestwas created before the later ofthe coming into force of subsection 419(1) of the Trust and Loan Companies Act, in the case of a federal member institution that is a company to which that Act applies, or of subsection 419(1) of the Bank Act, chapter 46 of the Statutes of Canada, 1991, in the case of a federal member institution that is a bank, andthe coming into force of section 11 of this Act; andis exempted by the Superintendent from the application of those paragraphs and that subsection.
 — 1996, c. 6, s. 45.1(2)
 — 2007, c. 29, s. 118
Canada Deposit Insurance Corporation ActThe amendment to the Canada Deposit Insurance Corporation Act made by section 103 of this Act applies only to a federal member institution in respect of which an order under subsection 39.13(1) of that Act is made on or after the day on which the amendment comes into force.
 — 2023, c. 26, s. 629
ReviewAfter April 30, 2024, the Minister of Finance must undertake a review of section 12.01 of the Canada Deposit Insurance Corporation Act, as that section reads on April 30, 2024. The Minister must publish a report on the review.
AMENDMENTS NOT IN FORCE — 2021, c. 23, s. 129
Section 39.24 of the English version of the Act is replaced by the following:
Determination and decision conclusiveExcept as otherwise provided in this Act, a determination or decision made by the Corporation under section 39.23 or by an assessor appointed under section 39.26 is for all purposes final and conclusive and shall not be questioned or reviewed in any court.
 — 2021, c. 23, s. 130
Section 39.26 of the Act is replaced by the following:
Appointment of assessorIn the circumstances prescribed by the regulations, the Governor in Council shall, by order, appoint as assessor a judge who is in receipt of a salary under the Judges Act to review a determination made by the Corporation under subsection 39.23(1).ReviewIn reviewing the Corporation’s determination, the assessor shall decide whether the Corporation made its determination based on an erroneous finding of fact that it made in a perverse or capricious manner or without regard for the material before it or on an unreasonable estimate.Confirmation of determinationIf the assessor decides that the Corporation did not make its determination based on such a finding of fact or on such an estimate, the assessor shall confirm the Corporation’s determination.Determination of amountIf the assessor decides that the Corporation made its determination based on such a finding of fact or on such an estimate, the assessor shall determine, in accordance with the regulations and the by-laws, the amount of compensation, if any, to be paid to the prescribed person and substitute the assessor’s determination for the Corporation’s determination.
 — 2021, c. 23, s. 131
Subsection 39.28(2) of the Act is replaced by the following:By-lawsThe Corporation may make by-laws respecting compensation for the purposes of sections 39.23 and 39.26.
2021, c. 232024-04-302023, c. 262024-04-302023, c. 262023-06-222022, c. 192023-04-012022, c. 102022-06-232018, c. 12, s. 2082022-04-302018, c. 12, s. 2122022-04-302021, c. 232022-04-302020, c. 12021-06-302021, c. 232021-06-29