PART XVII INVESTMENTS
Interpretation
432 (1) In this Part and except as otherwise provided, “affiliate” means, in respect of a particular entity, another entity who is affiliated with the particular entity for the purposes of this Part; (“membre du même groupe”) “commercial loan” means, in respect of an insurer, (a)  a loan made or acquired by the insurer other than, (i)  a loan to an individual in an amount that is equal to or less than the amount prescribed by the regulations, (ii)  a loan to the Government of Canada, the government of a province of Canada, a municipality or any agency of any of them, or to the government of a foreign country or any political subdivision of a foreign country or to any of their agencies, (iii)  a loan to an entity that is an international agency prescribed by the regulations or to another entity prescribed by the regulations, (iv)  a loan that is guaranteed by, or fully secured by securities issued by, any government, a municipality or an agency or other entity referred to in subclause (ii) or (iii), (v)  a loan that is secured by a mortgage on residential real property where the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the same property, does not exceed 80 per cent of the value of the property at the time the loan is made or acquired or such other amount as may be determined under the regulations, (vi)  a loan that is secured by a mortgage on real property that is not residential property where, (A)  the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, does not exceed 80 per cent of the value of the property at the time the loan is made or acquired, or such other amount as may be determined under the regulations, and (B)  at the time the loan is made or acquired, the property provides an annual income sufficient to pay all annual expenses related to the property, including the payments owing under the mortgage and any mortgages having an equal or prior claim against the property, (vii)  a loan that is secured by a mortgage on residential real property where, (A)  the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, exceeds 80 per cent of the value of the property at the time the loan is made or acquired, or such other amount as may be determined under the regulations, and (B)  repayment of the amount of the loan that exceeds 80 per cent of the value of the property, or such other amount as may be determined under the regulations, is guaranteed or insured by a government agency or is insured by an insurance company licensed under this Act or the Insurance Companies Act (Canada) to undertake mortgage insurance, (viii)  a loan that is secured by a mortgage on real property that is not residential property where, (A)  the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, exceeds 80 per cent of the value of the property at the time the loan is made or acquired, or such other amount as may be determined under the regulations, (B)  repayment of the amount of the loan that exceeds 80 per cent of the value of the property, or such other amount as may be determined under the regulations, is guaranteed or insured by a government agency or is insured by an insurance company  licensed under this Act or the Insurance Companies Act (Canada) to undertake mortgage insurance, and (C)  at the time the loan is made or acquired, the real property provides an annual income sufficient to pay all annual expenses related to the property, including the payments owing under the mortgage and any mortgages having an equal or prior claim against the real property, (ix)  a loan that is secured by a mortgage where the mortgage is taken back by the insurer as security on the disposition of real property by the insurer, (x)  a loan that, (A)  consists of a deposit made by the insurer with another financial institution, (B)  is fully secured by a deposit with a financial institution, (C)  is fully secured by debt obligations guaranteed by a financial institution other than the insurer, or (D)  is fully secured by a guarantee of a financial institution other than the insurer, (xi)  an advance on the security of or against the cash surrender value of a policy, or (xii)  a loan to an entity controlled by the insurer, (b)  an investment in debt obligations other than, (i)  debt obligations that are guaranteed by a financial institution other than the insurer, that are fully secured by deposits with a financial institution or that are fully secured by debt obligations that are guaranteed by a financial institution other than the insurer, (ii)  debt obligations issued by the Government of Canada, the government of a province of Canada, a municipality, or any of their agencies, or by the government of a foreign country or any of its agencies, or by an international agency prescribed by the regulations or another entity prescribed by the regulations, (iii)  debt obligations that are guaranteed by, or fully secured by securities issued by, a government, a municipality or an agency referred to in subclause (ii), (iv)  debt obligations that are widely distributed, or (v)  debt obligations of an entity controlled by the insurer, (c)  an investment in shares of a corporation or in ownership interests in an unincorporated entity other than, (i)  shares or ownership interests that are widely distributed, (ii)  shares or ownership interests of an entity controlled by the insurer, or (iii)  participating shares; (“prêt commercial”) Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “commercial loan” in subsection 432 (1) of the Act is amended by striking out “prescribed by the regulations” wherever it appears and substituting in each case “prescribed by the Authority rules” and by striking out “determined under the regulations” wherever it appears and substituting in each case “determined under the Authority rules”. (See: 2017, c. 34, Sched. 21, s. 36 (1)) “guarantee” includes a letter of credit; (“garantie”) “loan” includes an acceptance, advance on the security of or against the cash surrender value of a policy, an endorsement or another guarantee, a deposit, a financial lease, a conditional sales contract, a repurchase agreement and any other similar arrangement for obtaining funds or credit, but does not include investments in securities; (“prêt”) “permitted entity” means, in respect of an insurer, a financial institution or another entity that is prescribed by the regulations to be a permitted entity with respect to the insurer; (“entité admissible”) Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “permitted entity” in subsection 432 (1) of the Act is amended by striking out “by the regulations” and substituting “by the Authority rules”. (See: 2017, c. 34, Sched. 21, s. 36 (2)) “person” includes an entity; (“personne”) “prescribed subsidiary” means, in respect of an insurer, a subsidiary of the insurer that is a prescribed subsidiary or a member of a prescribed class of subsidiaries under the regulations. (“filiale prescrite”)  2006, c. 33, Sched. O, s. 15. Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “prescribed subsidiary” in subsection 432 (1) of the Act is amended by striking out “the regulations” at the end and substituting “the Authority rules”. (See: 2017, c. 34, Sched. 21, s. 36 (3)) Affiliated entities (2) Two entities are affiliated for the purposes of this Part if one of them is controlled by the other or if both of them are controlled by the same person.  2006, c. 33, Sched. O, s. 15. Control, corporations (3) For the purposes of this Part, a corporation is controlled by a person if, (a)  voting shares of the corporation carrying more than 50 per cent of the votes for the election of directors are held, other than by way of only security for a debt, by or for the benefit of the person; and (b)  the votes carried by those shares are sufficient, if exercised, to elect a majority of the directors of the corporation.  2006, c. 33, Sched. O, s. 15. Control, unincorporated entities (4) For the purposes of this Part, an unincorporated entity other than a limited partnership is controlled by a person if the person, (a)  has more than 50 per cent of the beneficial ownership interests, however designated, in the entity; and (b)  is able to direct the business and affairs of the entity.  2006, c. 33, Sched. O, s. 15. Control, limited partnership (5) For the purposes of this Part, a limited partnership is controlled by its general partner.  2006, c. 33, Sched. O, s. 15. Deemed control (6) A person that controls a particular entity is deemed to control any entity that is controlled or deemed to be controlled by the particular entity.  2006, c. 33, Sched. O, s. 15. Same (7) A person is deemed to control a particular entity if the aggregate of all securities of the particular entity that are beneficially owned by that person or by an entity controlled by that person would be sufficient, if they were held by that person, to permit the person to control the particular entity.  2006, c. 33, Sched. O, s. 15. Subsidiary (8) An entity is a subsidiary of another entity if it is controlled by the other entity.  2006, c. 33, Sched. O, s. 15. Substantial investment (9) For the purposes of this Part, a person has a substantial investment in an entity, (a)  in the case of an entity that is a corporation, if the person and any entities controlled by the person beneficially own, in total, (i)  voting shares of the corporation carrying more than 10 per cent of the voting rights attached to all of the outstanding voting shares of the corporation, or (ii)  shares of the corporation representing more than 25 per cent of the shareholders’ equity of the corporation; and (b)  in the case of an entity that is unincorporated, if the aggregate of any ownership interests into which the entity is divided, however designated, that are beneficially owned by the person and any entities controlled by the person exceeds 25 per cent of all the ownership interests into which the entity is divided.  2006, c. 33, Sched. O, s. 15. Section Amendments with date in force (d/m/y) 2006, c. 33, Sched. O, s. 15 - 05/05/2008 2017, c. 34, Sched. 21, s. 36 (1-3) - not in force CTS 04 SE 18 - 1