Her Excellency the Governor General in Council, on the recommendation of the President of the Treasury Board, pursuant to paragraph 50(d) of the Public Sector Pension Investment Board Acta, hereby makes the annexed Public Sector Pension Investment Board Regulations.S.C. 1999, c. 34InterpretationThe definitions in this section apply in these Regulations.Act means the Public Sector Pension Investment Board Act. (Loi)Canadian corporation[Repealed, SOR/2001-463, s. 1]Canadian resource property has the same meaning as in paragraph (c) of the definition Canadian resource property in subsection 66(15) of the Income Tax Act. (avoir minier canadien)child means the child of, or an individual adopted either legally or in fact by, a person or the person's spouse or common-law partner. (enfant)common-law partner, in relation to an individual, means a person who is cohabiting in a relationship of a conjugal nature with the individual, having so cohabited for a period of at least one year at the relevant time. (conjoint de fait)debt obligation means a bond, debenture, note or other evidence of indebtedness of an entity. (titre de créance)derivative means a financial instrument or agreement whose value is derived from or is based on an underlying asset or the relationship between two underlying assets, other thana convertible security;an asset-backed security;a security of a mutual fund;an index participation unit;a security of a non-redeemable fund;a government or corporate strip bond; ora listed dividend share of a subdivided equity or fixed income security. (instrument dérivé)financial institution meansa bank;a body corporate to which the Trust and Loan Companies Act applies;a cooperative credit society to which the Cooperative Credit Associations Act applies;an insurance company to which the Insurance Companies Act applies;a trust, loan or insurance corporation incorporated by or under an Act of the legislature of a province;a cooperative credit society incorporated and regulated by or under an Act of the legislature of a province;an entity that is incorporated or formed by or under an Act of Parliament or of the legislature of a province and that is primarily engaged in dealing in securities, including portfolio management and investment counselling; ora foreign institution. (institution financière)foreign institution means an entity that isengaged in the business of banking, the trust, loan or insurance business, the business of a cooperative credit society or the business of dealing in securities or is engaged primarily in the business of providing financial services; andincorporated or formed otherwise than by or under an Act of Parliament or of the legislature of a province. (institution étrangère)investment corporation means a corporation thatholds at least 98 per cent of its assets in cash, investments and loans;does not issue debt obligations; andobtains at least 98 per cent of its income from investments and loans. (société de placement)loan includes a deposit, financial lease, conditional sales contract, repurchase agreement and any other similar arrangement for obtaining money or credit, but does not include investments in securities or the making of an acceptance, endorsement or other guarantee. (prêt)market terms and conditions, in respect of a transaction, means terms and conditions, including those relating to price, rent or interest rate, that would apply to a similar transaction in an open market under conditions requisite to a fair transaction between parties who are at arm's length and acting prudently, knowledgeably and willingly. (conditions du marché)person includes an entity. (personne)public exchange means a market for the trading of securities that is recognized by an appropriate governmental authority. (bourse)real estate corporation means a corporation incorporated to acquire, hold, maintain, improve, lease or manage real or immovable property other than real property that yields petroleum or natural gas. (société immobilière))real or immovable property includes a leasehold interest in real or immovable property. (biens immeubles ou réels)real property[Repealed, SOR/2005-416, s. 1]related party means a person who isa director, officer or employee of the Board;a person responsible for holding or investing the assets of the Board, or any director, officer or employee of the person;a contributor within the meaning of subsection 2(1) of the Canadian Forces Superannuation Act, subsection 3(1) of the Public Service Superannuation Act or subsection 3(1) of the Royal Canadian Mounted Police Superannuation Act or a participant or former participant in the Reserve Force Pension Plan established by the Reserve Force Pension Plan Regulations;a survivor within the meaning of subsection 2(1) of the Canadian Forces Superannuation Act, paragraph 36(1)(b) of the Reserve Force Pension Plan Regulations, subsection 3(1) of the Public Service Superannuation Act or subsection 3(1) of the Royal Canadian Mounted Police Superannuation Act;an association or union representing a person referred to in any of paragraphs (a) to (d), or a director, an officer or an employee of that association or union;the spouse, common-law partner or child of any person referred to in any of paragraphs (a) to (e) or the spouse or common-law partner of that child;a corporation that is directly or indirectly controlled by a person referred to in any of paragraphs (a) to (f); oran entity in which a person referred to in any of paragraphs (a) to (f) has a substantial investment.It does not include Her Majesty in right of Canada or of a province, or an agency of either one, or a trust company or financial institution that holds the assets of the Board. (apparenté)resource corporation means a corporation incorporated to acquire, hold, explore, develop, maintain, improve, manage, operate or dispose of Canadian resource properties. (société minière)security meansin respect of a corporation, a share of any class of shares of the corporation or a debt obligation of the corporation, and includes a warrant of the corporation, but does not include a deposit with a financial institution or an instrument evidencing such a deposit; andin respect of any other entity, any ownership interest in, or debt obligation of, the entity. (titre ou valeur mobilière)transaction includesa contract;a guarantee;an investment;the taking of an assignment of, or otherwise acquiring, a loan made by a third party;the taking of a security interest in securities; andany modification, renewal or extension of a prior transaction. (transaction)underlying asset means a financial instrument, security, commodity, currency, interest rate, foreign exchange rate, economic indicator, index, basket, agreement, benchmark or any other financial reference, interest or variable. (actif sous-jacent)voting share means a share of any class of shares of a corporation that carries voting rights under all circumstances, by reason of an event that has occurred and is continuing or by reason of a condition that has been fulfilled. (action avec droit de vote) SOR/2000-243, s. 1; SOR/2001-463, s. 1; SOR/2005-416, s. 1; SOR/2012-295, s. 1For the purposes of these Regulations,a person controls a corporation if securities of the corporation to which are attached more than 50 per cent of the votes that may be cast to elect the directors of the corporation are beneficially owned by the person and the votes attached to those securities are sufficient, if exercised, to elect a majority of the directors of the corporation;a person controls an unincorporated entity, other than a limited partnership, if more than 50 per cent of the ownership interests into which the unincorporated entity is divided are beneficially owned by the person and the person is able to direct the business and affairs of the unincorporated entity;the general partner of a limited partnership controls the limited partnership; anda trustee of a trust controls the trust.For the purposes of these Regulations, a person who controls an entity is deemed to control any other entity that is controlled by the entity.SOR/2000-243, s. 1For the purposes of these Regulations, the making, holding or acquiring of an investment indirectly by the Board, or the holding, acquiring or owning of property indirectly by the Board, includes the making, holding, acquiring or owning of an investment or property, as the case may be, byan investment corporation, a real estate corporation or a resource corporation the securities of which have been invested in by the Board under subsection 13(3), (4) or (5);an investment corporation, a real estate corporation or a resource corporation the securities of which are held by a corporation referred in paragraph (a) and to which are attached more than 30 per cent of the votes that may be cast to elect the directors of the corporation; ora mutual or pooled fund or a trust fund in which the assets of the Board have been invested.SOR/2000-243, s. 1; SOR/2005-416, s. 2For the purposes of these Regulations, an entity is affiliated with another entity if the entity is controlled by the other entity or if both entities are controlled by the same person.SOR/2000-243, s. 1For the purposes of these Regulations, a person has a substantial investment inan unincorporated entity if the person or an entity controlled by the person beneficially owns more than 25 per cent of the ownership interests in the unincorporated entity; anda corporation ifthe voting rights attached to voting shares of the corporation that are beneficially owned by the person, or by an entity controlled by the person, exceed 10 per cent of the voting rights attached to all of the outstanding voting shares of the corporation, orshares of the corporation that are beneficially owned by the person, or by an entity controlled by the person, represent ownership of more than 25 per cent of the shareholders' equity of the corporation.SOR/2000-243, s. 1For the purposes of these Regulations, a person is associated witha corporation that the person controls and every affiliate of every such corporation;a person who controls the person;a partner who has a substantial investment in a partnership in which the person has a substantial investment;a trust or estate in which the person has a substantial investment or for which the person serves as trustee or in a capacity similar to that of a trustee;the spouse or common-law partner of the person; anda brother, sister or child or other descendant of the person, or the spouse or common-law partner of any of them.SOR/2000-243, s. 1For the purposes of subparagraphs 6(2)(g)(ii) and 10(1)(a)(ii) of the Act, the prescribed kind of superannuation or pension benefit is one that isgranted under the Judges Act;payable under the Governor General's Act or the Lieutenant Governors Superannuation Act; orpayable out of the Consolidated Revenue Fund, or out of a superannuation or pension fund or plan pursuant to which contributions have been paid out of the Consolidated Revenue Fund in respect of employees engaged locally outside of Canada, and that isrelated in amount to the period of service that may be counted by the person to whom the superannuation or pension benefit is payable, andpayable in instalments during the lifetime of the recipient and after his or her lifetime if the plan under which the superannuation or pension benefit is payable so provides.SOR/2000-243, s. 1InvestmentsGeneralIn selecting investments, the Board shall evaluate them having regard to the overall rate of return and risk of loss of the entire portfolio of investments held by the Board.SOR/2000-243, s. 1Statement of Investment Policies, Standards and ProceduresA written statement of the investment policies, standards and procedures in respect of the Board's portfolio of investments, established under section 32 of the Act, shall includecategories of investments;the use of options, futures and other derivatives;diversification of the investment portfolio;asset mix and rate of return expectations;policies for the management of credit, market and other financial risks;liquidity of investments;the lending of cash or securities;the retention or delegation of voting rights acquired through investments;[Repealed, SOR/2001-463, s. 2]the method of, and basis for, the valuation of investments that are not regularly traded at a public exchange; andrelated party transactions permitted under section 17 and the criteria used to establish whether the value of a transaction is nominal.The statement referred to in subsection (1) shall include a description of all factors that may affect the funding of the pension plans established under the Acts referred to in paragraph 4(1)(a) of the Act and the ability of the pension plans to meet their financial obligations and the relationship of those factors to those policies, standards and procedures.The board of directors shall review and confirm or amend the statement at least once each financial year.SOR/2000-243, s. 1; SOR/2001-463, s. 2[Repealed, SOR/2001-463, s. 3]Quantitative LimitsThe Board must not directly or indirectly invest more than 10% of the total market value of the Board’s assets in the securities ofany one person;two or more associated persons; ortwo or more affiliated corporations.Subsection (1) does not apply in respect of investments ina subsidiary of the Board;securities issued or fully guaranteed by the Government of Canada, the government of a province, or an agency of either of them;securities issued or fully guaranteed by the Government of the United States or any of its agencies;a fund composed of mortgage-backed securities that are fully guaranteed by the Government of Canada, the government of a province, or an agency of either of them;a fund that substantially replicates the composition of a widely recognized index of a broad class of securities traded on a public exchange; ora segregated fund or mutual or pooled fund that complies with the requirements applicable to a plan under the Pension Benefits Standards Regulations, 1985.SOR/2000-243, s. 1SOR/2021-207, s. 1[Repealed, SOR/2012-295, s. 2]The Board shall not directly or indirectly invest in the securities of a corporation to which are attached more than 30 per cent of the votes that may be cast to elect the directors of the corporation.Subsection (1) does not apply in respect of investments in securities issued by a subsidiary of the Board.Subsection (1) does not apply in respect of investments in securities issued by an investment corporation if the corporationdoes not enter into a transaction — with a related party, or with a person who has ceased to be a related party within the 12 month period preceding the transaction — that the Board would be prohibited from entering into under section 16;limits its investments to those that are authorized for the Board under these Regulations;does not invest, or hold an investment, in securities of any other investment corporation to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation, unless the corporation first obtains, and provides to the Board, an undertaking by the other investment corporationnot to enter into a transaction — with a related party, or with a person who has ceased to be a related party within the 12 month period preceding the transaction — that the Board would be prohibited from entering into under section 16,not to invest, or hold an investment, in the securities of any other investment corporation, andto limit its investments to those that are authorized for the Board under these Regulations; andhas provided to the Board an undertaking described in subsection (6).Subsection (1) does not apply in respect of investments in securities issued by a real estate corporation if the corporationlimits its activities to acquiring, holding, maintaining, improving, leasing or managing real or immovable property, that is owned by, or held on behalf of, or mortgaged or hypothecated tothe Board,the corporation,any other real estate corporation in which securities to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation have been invested in by, or on behalf of, the Board pursuant to this subsection, orany other real estate corporation in which securities to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation are owned by the corporation or by a real estate corporation referred to in subparagraph (iii);restricts its investments and loans, other than investments in real or immovable property or in the securities of other real estate corporations, to those authorized for the Board;does not enter into a transaction — with a related party, or with a person who has ceased to be a related party within the 12 month period preceding the transaction — that the Board would be prohibited from entering into under section 16;does not invest, or hold an investment, in securities of any other real estate corporation to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation, unless the corporation first obtains and deposits with the Board an undertaking by the other real estate corporationnot to enter into a transaction — with a related party, or with a person who has ceased to be a related party within the 12 month period preceding the transaction — that the Board would be prohibited from entering into under section 16,not to invest, or hold an investment, in the securities of any other real estate corporation; andhas provided to the Board an undertaking described in subsection (6).Subsection (1) does not apply in respect of investments in securities issued by a resource corporation if the corporationlimits its activities to acquiring, holding, exploring, developing, maintaining, improving, managing, operating or disposing of Canadian resource properties that are owned by, or held on behalf of,the Board,the corporation,any other resource corporation in which securities to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation have been invested in by, or on behalf of, the Board pursuant to this subsection, orany other resource corporation in which securities to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation are owned by the corporation or by a resource corporation referred to in subparagraph (iii);restricts its investments and loans — other than investments in Canadian resource properties, investments in property to be used in connection with Canadian resource properties owned by the corporation, loans secured by Canadian resource properties to persons resident in Canada for the exploration or development of these properties, and investments in the securities of other resource corporations — to those authorized for the Board;does not borrow money other than for the purpose of earning income from Canadian resource properties;does not enter into a transaction — with a related party, or with a person who has ceased to be a related party within the 12 month period preceding the transaction — that the Board would be prohibited from entering into under section 16;does not invest, or hold an investment, in securities of any other resource corporation to which are attached more than 30 per cent of the votes that may be cast to elect the directors of that corporation, unless the corporation first obtains, and provides to the Board, an undertaking by the other resource corporationnot to enter into a transaction — with a related party, or with a person who has ceased to be a related party within the 12 month period preceding the transaction — that the Board would be prohibited from entering into under section 16,not to invest, or hold an investment, in the securities of any other resource corporation; andhas provided to the Board an undertaking described in subsection (6).An undertaking made by an investment corporation, a real estate corporation or a resource corporation to the Board must provide that for as long as the Board directly or indirectly holds securities to which are attached more than 30 per cent of the votes that may be cast to elect its directors, the corporation willfile with the Board, at such intervals or times as the Board directs,copies of its annual financial statements,copies of its audited financial statements in respect of the immediately preceding 5 fiscal years, or for each year since the corporation was incorporated, if less than 5 years,a list clearly identifying the assets of the corporation and the market value of each asset,a list of the names of its officers, directors and shareholders, anda certificate stating that the corporation is complying with its undertaking; andpermit the Board or a person authorized by the Board to visit its head office and to examine its books and records.SOR/2000-243, s. 1; SOR/2005-416, s. 4If the Board directly or indirectly invests in the securities of a real estate corporation or resource corporation to which are attached more than 30 per cent of the votes that may be cast to elect the directors of the corporation, the Board shall keep, in respect of each fund that holds common shares of the corporation, a record of the investment that shows the value of the common shares that is obtained by multiplyingan amount equal to the assets of the corporation less the sum of its liabilities and its preferred capital stockbythe number of common shares of the corporation held by the fund, divided by the total number of the issued and outstanding common shares of the corporation.The Board shall keep the record with the record of investments referred in paragraph 35(1)(c) of the Act.SOR/2005-416, s. 5[Repealed, SOR/2007-304, s. 1]Related Party TransactionsFor the purposes of sections 16 and 17if a transaction is entered into by, or on behalf of, the Board with a person who the Board, or any person acting on the Board's behalf, knows will become a related party to the Board, the person shall be considered to be a related party of the Board in respect of the transaction; andthe fulfilment of an obligation under the terms of any transaction, including the payment of interest on a loan or deposit, is part of the transaction and not a separate transaction.SOR/2000-243, s. 1Subject to sections 17 and 18, the Board shall not directly or indirectly enter into a transaction with a related party or with a person who has ceased to be a related party within the 12-month period preceding the transaction.SOR/2000-243, s. 1The Board may enter into a transaction with a related party ifthe transaction is required for the operation or administration of the Board; andthe terms and conditions of the transaction are not less favourable to the Board than market terms and conditions.The Board may invest the moneys of the Board in the securities of a related party if those securities are acquired at a public exchange.The Board may enter into a transaction with a related party if the value of the transaction is nominal.For the purposes of subsection (3), in assessing whether the value of a transaction is nominal, two or more transactions with the same related party shall be considered as a single transaction.SOR/2000-243, s. 1MiscellaneousSections 11 to 16 do not apply in respect ofinvestments in a corporation that are held as a result of an arrangement, within the meaning of subsection 192(1) of the Canada Business Corporations Act, for the reorganization or liquidation of the corporation or for the amalgamation of the corporation with another corporation, if the investments are to be exchanged for shares or debt obligations; orassets that are acquired through the realization of a security interest held by the Board and that are held for a period not exceeding two years after the day on which the assets were acquired.SOR/2000-243, s. 1; SOR/2001-463, s. 4The moneys of the Board are to be investedin a name that clearly indicates that the investment is held in trust for the Board and, where the investment is capable of being registered, registered in that name;in the name of a financial institution, or a nominee of one, in accordance with a custodial agreement or trust agreement, entered into with the financial institution, that clearly indicates that the investment is held for the Board; orin the name of The Canadian Depository for Securities Limited, or a nominee of it, in accordance with a custodial agreement or trust agreement, entered into with a financial institution, that clearly indicates that the investment is held for the Board.For the purposes of subsection (1), "custodial agreement" means an agreement providing thatan investment made or held on behalf of the Board pursuant to the agreementconstitutes part of the Board's assets, andshall not at any time constitute an asset of the custodian or nominee; andrecords shall be maintained by the custodian that are sufficient to allow the ownership of any investment to be traced to the Board at any time.SOR/2000-243, s. 1The Board shall maintain a current record that clearly identifies every investment held by the Board in its name and every investment held in the name of a third party on behalf of the Board, the name in which the investment is made and, where appropriate, the name in which the investment is registered.SOR/2000-243, s. 1Annual ReportThe definitions in this section apply in this Part.compensation includes annual salary, bonuses, non-cash remuneration, termination arrangements, and deferred compensation, including pension benefits funded by the Board, for service rendered by an individual in all capacities to the Board and its subsidiaries. (rémunération)executive officers means the five most highly compensated officers of the Board or its subsidiaries. (principaux dirigeants) SOR/2000-243, s. 1The annual report must include a statement of the corporate governance practices of the board of directors that sets outits duties, objectives and mandate;its committees, their composition, mandates and activities;the decisions requiring its prior approval;the procedures in place for the assessment of its performance; andits expectations in respect of the Board's management.The Board shall include, in its annual report, information disclosing the total compensation awarded to, earned by, or paid to the directors and executive officers during the financial year.The annual report must include a summary of the procedures established under paragraph 7(2)(d) of the Act.SOR/2000-243, s. 1SOR/2021-2072021-08-12