GreatNorthCollective/greatnorth-canada-federal-laws-text huggingface dataset:
Stablecoin Act — S-15.9 4
Not business of accepting deposit liabilities 4 The issuing of a stablecoin in accordance with this Act does not constitute engaging in the business of accepting deposit liabilities for the purposes of any of the following provisions: (a) subsections 468(3) and 930(3) and paragraph 948(1)(a) of the Bank Act ; (b) subsections 495(3) and (5), 554(3) and 971(3) of the Insurance Companies Act ; and (c) subsection 453(3) of the Trust and Loan Companies Act .
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Business of dealing in virtual currencies 5 An issuer is a person that is engaged in the business of dealing in virtual currencies for the purposes of subparagraphs 5(h)(iv) and (h.1)(iv) of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act .
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Objects 6 The Bank’s objects under this Act are to (a) supervise issuers in order to determine whether they are in compliance with this Act; (b) promote the adoption by issuers of policies and procedures that are designed to implement their duties under this Act; and (c) monitor and evaluate trends and issues related to stablecoins.
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Agreements or arrangements 7 The Bank may, for the purpose of exercising its powers or performing its duties and functions under this Act, enter into an agreement or arrangement with any government authority or regulatory body.
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Guidelines — Bank 8 (1) Subject to subsection (2), the Bank may issue guidelines respecting the manner in which this Act is to be applied. Guidelines — Minister (2) The Minister may issue guidelines respecting the manner in which the provisions of this Act that confer powers, duties or functions on the Minister are to be applied.
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Delegation of Governor’s powers, duties and functions 9 The Governor may delegate to an officer of the Bank any of the Governor’s powers, duties or functions under this Act.
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Interprovincial or international applications 10 This Act applies only in respect of a stablecoin that has or could reasonably be expected to have interprovincial or international applications.
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Closed-loop stablecoin 11 Subject to the regulations, this Act does not apply in respect of a closed-loop stablecoin.
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Issuers 12 Subject to the regulations, this Act does not apply to an issuer that is a financial institution.
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Central bank 13 This Act does not apply to an issuer that is a central bank.
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Governor’s order 14 If the Governor is of the opinion that a provincial or foreign law or a provision of a provincial or foreign law applies to or in respect of an applicant or a class of applicants or an issuer or a class of issuers and that the provincial or foreign law or the provision of the provincial or foreign law is substantially similar to this Act or the regulations or a provision of this Act or the regulations, then the Governor may, by order, specify that this Act or the regulations, or any provision of this Act or the regulations, does not apply to or in respect of the applicant, the issuer or the class of applicants or issuers, subject to any conditions that the Governor considers appropriate.
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Prohibition — issuing 15 A person must not issue a stablecoin unless the person complies with this Act and their name is included in the list of issuers referred to in paragraph 16 (a).
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Registry 16 The Bank must maintain a public registry that contains (a) a list of issuers, including any information provided for in the regulations; (b) subject to section 76 , information respecting each (i) order made under section 14 , (ii) directive given under subsection 27 (1), (iii) order made under section 60 , (iv) order made under section 61 , (v) compliance agreement entered into under section 62 , (vi) direction made under subsection 63 (1) or (3), (vii) direction made under section 66 , if the Bank considers it appropriate to include that information in the registry, (viii) order made under subsection 74 (1) or (3); (c) the information that is made public under section 92 ; and (d) any other information provided for in the regulations.
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Application required 17 (1) A person must submit an application to the Bank in order to have their name added to the list of issuers referred to in paragraph 16 (a). Contents of application (2) An application must contain the following information: (a) information about the ownership of the applicant; (b) a description of how the applicant is organized and structured and, if applicable, information about the applicant’s subsidiaries, affiliates and third parties; (c) a description of the technological systems that are used or that will be used by the applicant or any third parties in relation to the stablecoin that the applicant plans to issue, including the distributed ledgers, any smart contracts or computer code with respect to the issuing or redemption of the stablecoin and any other technological infrastructure through which the stablecoin will be issued or redeemed; (d) the applicant’s redemption policy; (e) a description of the measures that the applicant has taken or plans to take to comply with sections 37 to 39 ; (f) a statement from a lawyer of whether, in the lawyer’s opinion, the measures referred to in paragraph (e) enable the applicant to comply with sections 38 and 39 ; (g) a statement from a certified accountant of the applicant’s financial condition; (h) the applicant’s governance policy, risk management policy, data security policy and recovery and resolution policy; (i) information about any enforcement actions that have been taken in relation to the applicant under a federal, provincial or foreign law that relates to anti-money laundering or anti-terrorist financing measures, the provision of financial services, securities and derivatives, market conduct or consumer protection; (j) any information requested by the Bank; and (k) any information provided for in the regulations. Statement — lawyer (3) The statement referred to in paragraph (2)(f) must be prepared by a lawyer who, within the meaning of the regulations, is independent of the applicant and any related party of the applicant and meets any other requirements provided for in the regulations. Statement — certified accountant (4) The statement referred to in paragraph (2)(g) must be prepared by a certified accountant who, within the meaning of the regulations, is independent of the applicant and any related party of the applicant and meets any other requirements provided for in the regulations. Fee (5) An applicant must include with the application a fee that is determined by the Bank.
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Information requested by Bank 18 An applicant must provide the Bank with any information that the Bank requests in relation to the application, within the time and in the manner provided for in the regulations, if any.
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Notice of change 19 An applicant must notify the Bank of any change to any information that was provided to the Bank, within the time and in the manner provided for in the regulations, if any. The Bank must then notify the Minister and any designated person or government authority.
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Application complete 20 As soon as feasible after the Bank is of the opinion that an application is complete, the Bank must (a) provide the Minister and any designated person or government authority, for the purpose of enabling them to assist the Minister in exercising the Minister’s powers and performing the Minister’s duties and functions under this Act, with the completed application; (b) provide the Centre with the completed application for the purpose of enabling the Centre to carry out its objects under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act ; and (c) notify the applicant that the application is complete.
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Decision to review application 21 (1) The Minister may, within the period provided for in the regulations, decide to review an application if the Minister is of the opinion that it is necessary to do so for reasons related to national security. If the Minister decides to review an application, the Minister must notify the Bank and the Bank must then notify the applicant. Extension of period (2) The Minister may extend the period for one or more periods provided for in the regulations if the Minister considers it necessary to do so and notifies the Bank. In that case, the Bank must notify the applicant of the extension.
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Bank not authorized to add name to list 22 The Bank must not add the applicant’s name to the list of issuers referred to in paragraph 16 (a) during a period referred to in subsection 21 (1) or (2) unless the Minister informs the Bank that the Minister has decided not to review the application.
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Time for review 23 (1) If the Minister decides to review an application, the Minister must conduct the review within the period provided for in the regulations. Extension of period (2) The Minister may extend the period for conducting the review for one or more periods provided for in the regulations if the Minister considers it necessary to do so and notifies the Bank. In that case, the Bank must notify the applicant of the extension.
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Bank not authorized to add name to list 24 If the Minister notifies the Bank that the Minister has decided to review an application, the Bank must not add the applicant’s name to the list of issuers referred to in paragraph 16 (a) unless the Minister notifies the Bank that the Minister has decided not to give a directive under subsection 27 (1).
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Notice to Bank 25 The Minister must notify the Bank if, after completing a review of an application, the Minister decides not to give a directive under subsection 27 (1).
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Additional information 26 (1) An applicant must provide the Minister and any designated person or government authority with any additional information that the Minister or the designated person or government authority requests in relation to the applicant or the activities that the applicant performs or plans to perform in relation to a stablecoin. Manner (2) A request for information under subsection (1) must be submitted to the Bank, which must then transmit it to the applicant. The applicant must provide the requested information to the Bank, which must then transmit it to the Minister and the designated person or government authority.
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Directive to refuse application 27 (1) The Minister may, for any of the following reasons, give a directive to the Bank to refuse an application: (a) there are reasons related to national security; (b) the applicant has failed to provide additional information in accordance with section 26 ; (c) an order made under section 70 , or an undertaking required under that section, that relates to the application has not been complied with; (d) a condition imposed under section 71 that relates to the application has not been complied with; (e) the applicant has provided false or misleading information to the Bank, the Minister or any designated person or government authority; (f) any other reason provided for in the regulations. Representations (2) The Minister must not give a directive to the Bank to refuse an application unless the applicant is provided with an opportunity to make representations to the Minister in respect of the matter.
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Refusal of application 28 If the Minister gives a directive to the Bank to refuse an application, the Bank must refuse the application and, as soon as feasible, notify the applicant that the application has been refused.
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Name added to list 29 If the Minister notifies the Bank that the Minister has decided not to give a directive to refuse an application, the Bank must, as soon as feasible, add the applicant’s name to the list of issuers referred to in paragraph 16 (a) and notify the applicant.
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False or misleading information 30 An issuer must not communicate or otherwise provide false or misleading information to the public.
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Prohibition 31 An issuer must not (a) use terms, expressions, logos, symbols or illustrations provided for in the regulations; or (b) use, in a manner that is contrary to the regulations, terms, expressions, logos, symbols or illustrations provided for in the regulations.
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Prohibition 32 An issuer must not, directly or indirectly, grant or pay to the holder of a stablecoin that the issuer has issued any form of interest or yield in respect of that stablecoin, whether in cash, digital assets or other consideration.
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Prohibition 33 An issuer must not issue a stablecoin if, in Canada or a foreign jurisdiction, the stablecoin is (a) legal tender; (b) a deposit or proof of a deposit; or (c) insured under a public deposit insurance system or guaranteed or backstopped by a government.
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Representations 34 An issuer must not represent a stablecoin in a manner that suggests that the stablecoin is (a) legal tender; (b) a deposit or proof of a deposit; or (c) insured under a public deposit insurance system or guaranteed or backstopped by a government.
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Redemption 35 An issuer must redeem outstanding stablecoins in the reference currency, at par value and in accordance with the regulations, if any.
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Redemption policy 36 (1) An issuer must, in accordance with the regulations, if any, establish and make publicly available a policy respecting the redemption of outstanding stablecoins that contains (a) the conditions that apply to redemption, including with respect to the manner and timing of redemption and any fees or charges that may be payable to the issuer or any other person; (b) a description of the roles of any third parties; and (c) any information provided for in the regulations. Policy provided to Bank (2) An issuer must provide the Bank with the redemption policy.
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Duty to maintain reserve 37 (1) An issuer must, in accordance with the regulations, if any, maintain a reserve of assets that has a value that is equal to or greater than the par value of outstanding stablecoins. Use of assets (2) Subject to the regulations, an issuer must not use the assets in the reserve of assets for a purpose other than to redeem outstanding stablecoins. Composition (3) The reserve of assets must be composed exclusively of the reference currency or other high-quality liquid assets that are (a) denominated in the reference currency; and (b) provided for in the regulations or, if no regulations are made, approved by the Bank.
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No encumbrance 38 Subject to the regulations, an issuer must not pledge as collateral, create a security or a security interest in or otherwise encumber the assets in the reserve of assets.
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Qualified custodian — placement of assets 39 (1) An issuer must, in accordance with the regulations, if any, place the assets in the reserve of assets with one or more qualified custodians. Holding of assets (2) An issuer must, in accordance with the regulations, if any, ensure that each qualified custodian holds the assets in the reserve of assets (a) in a manner that ensures that the assets are segregated from the qualified custodian’s own assets and the issuer’s other assets; (b) in a manner that ensures that the assets are not available to satisfy creditors of the qualified custodian or the issuer, including under the Bankruptcy and Insolvency Act or a provincial or foreign law dealing with bankruptcy and insolvency, other than to satisfy any claims of the holders of a stablecoin with respect to the redemption of the stablecoin; and (c) in accordance with the regulations, if any.
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Governance policy 40 An issuer must, in accordance with the regulations, if any, establish, implement and maintain a governance policy that describes (a) the roles and responsibilities of the members of the issuer’s governing body and senior management with respect to all activities related to a stablecoin that it issues; (b) the measures that the issuer has put in place to ensure accountability and oversight with respect to all activities related to a stablecoin that it issues; (c) the roles of third parties and the policies and procedures the issuer has established to identify and manage conflicts of interest; and (d) any other matter provided for in the regulations.
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Risk management policy 41 An issuer must, in accordance with the regulations, if any, establish, implement and maintain a risk management policy that describes the measures that it has put in place to (a) ensure operational resilience, incident response, continuity of critical functions and recovery from disruptions; (b) identify and manage risks related to third parties; (c) implement cybersecurity safeguards to protect the issuer’s systems and data against unauthorized access, disruption or misuse; (d) identify and manage risks related to money laundering and terrorist financing; and (e) address any other matter provided for in the regulations.
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Data security policy 42 An issuer must, in accordance with the regulations, if any, establish, implement and maintain a data security policy that describes the measures that it has put in place to protect (a) personal information, in a manner that is appropriate to the sensitivity of the information, against loss or theft or unauthorized access, disclosure, copying, use or modification; (b) the data that the issuer collects, retains or reports under this Act against loss or theft or unauthorized access, disclosure, copying, use or modification; and (c) any other data provided for in the regulations.
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Recovery and resolution policy 43 An issuer must, in accordance with the regulations, if any, establish, implement and maintain a recovery and resolution policy that describes the measures that it has put in place to (a) ensure an orderly resolution or winding down of the issuer’s activities in relation to the stablecoin that it issues, including with respect to the redemption of outstanding stablecoins and the protection of stablecoin holders’ claims to the reserve of assets; and (b) address any other matter provided for in the regulations.
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Policies available 44 An issuer must provide the Bank with the policies referred to in sections 40 to 43 and make them publicly available in accordance with the regulations, if any.
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Information publicly available 45 An issuer must, in accordance with the regulations, if any, make any information that is provided for in the regulations publicly available.
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Report 46 (1) An issuer must provide the Bank with a report that contains (a) a statement from a certified accountant of (i) the issuer’s financial condition, (ii) the number of outstanding stablecoins, (iii) the composition of the issuer’s reserve of assets and the fair market value of the assets in the reserve, and (iv) whether, in the certified accountant’s opinion, the reserve of assets satisfies the requirements of subsections 37 (1) and (3); (b) a statement from a lawyer of whether, in the lawyer’s opinion, the issuer is in compliance with sections 38 and 39 ; and (c) any information provided for in the regulations. Time and manner (2) Subject to subsection (3), an issuer must provide the Bank with the report within the time and in the manner provided for in the regulations or, if no regulations are made, within the time and in the manner determined by the Bank. Monthly statement (3) An issuer must provide the Bank with the information referred to in subparagraphs (1)(a)(i) to (iii) at least once every month. Report publicly available (4) An issuer must, in accordance with the regulations, if any, make the report publicly available, except for the information provided for in the regulations.
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Statement of lawyer 47 At the Bank’s request and within the time and in the manner determined by the Bank, an issuer must provide the Bank with a statement from a lawyer of whether, in the lawyer’s opinion, the issuer is in compliance with sections 38 and 39 .
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Certified accountant 48 (1) The statement referred to in paragraph 46 (1)(a) must be prepared by a certified accountant who, within the meaning of the regulations, is independent of the issuer and any related party of the issuer and meets any other requirements provided for in the regulations. Lawyer (2) The statements referred to in paragraph 46 (1)(b) and section 47 must be prepared by a lawyer who, within the meaning of the regulations, is independent of the issuer and any related party of the issuer and meets any other requirements provided for in the regulations.
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Notice of incident 49 (1) If an issuer becomes aware of an incident, the issuer must, without delay, notify the Bank and the Bank must then notify the Minister and any designated person or government authority. Notice (2) The notice must be given in accordance with the regulations, if any, and contain any information provided for in the regulations.
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Notice of significant change 50 An issuer must, in accordance with the regulations, if any, notify the Bank of any significant change to any information that was provided to the Bank. The Bank must then notify the Minister and any designated person or government authority, in accordance with the regulations, if any.
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Retention, use and disposal 51 An issuer must retain, use and dispose of personal information, and any other information provided for in the regulations, in accordance with the regulations, if any.
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False or misleading information 52 A person must not provide false or misleading information to the Bank, the Minister or any designated person or government authority.
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Bank to ascertain expenses 53 (1) The Bank must, before September 30 in each year, ascertain the total amount of expenses incurred by it during the immediately preceding calendar year for or in connection with the administration of this Act and deduct from that amount any fees paid to it under subsection 17 (5) in that preceding calendar year. Amount conclusive (2) The amount ascertained is final and conclusive for the purposes of this section. Assessment (3) As soon as feasible after ascertaining the amount, the Bank must assess a portion of the total amount of expenses against each issuer. Interim assessment (4) The Bank may, during each calendar year, prepare an interim assessment against any issuer. Assessment is binding (5) Every assessment and interim assessment is final and conclusive and binding on the issuer against which it is made. Recovery (6) Every assessment and interim assessment constitutes a debt due to the Bank, is immediately payable and may be recovered as a debt in any court of competent jurisdiction. Interest (7) Interest may be charged on the unpaid amount of an assessment or interim assessment at a rate equal to 2% plus the rate in effect that is prescribed under the Income Tax Act for amounts payable by the Minister of National Revenue as refunds of overpayments of tax under that Act.
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Information request 54 (1) The Bank may request in writing that an issuer provide the Bank, within the time provided for in the regulations, if any, with any information that the Bank considers necessary for the purposes of subsection 53 (3) or (4). Compliance with request (2) The issuer must comply with the request.