Business Law


Business Law

Equity Crowdfunding in Saskatchewan – A Step Ahead

Jul 10th, 2013


Some promising and exciting news came out of the Province of Saskatchewan yesterday (July 9, 2013) for equity crowdfunding!

The Financial and Consumer Affairs Authority of Saskatchewan (FCAA) hosted an information session and discussion regarding a proposed exemption to The Securities Act, 1988, (Saskatchewan securities rules) which would allow equity crowdfunding in Saskatchewan.

As I explained in earlier postings on crowdfunding and equity crowdfunding, equity crowdfunding is a way of issuing and selling capital stock in a company (among other securities) in small amounts to large numbers of people.

 As the FCAA explains:


Crowdfunding is growing in popularity around the world. In Canada, it’s being used to pre-sell products and receive donations for small businesses or creative projects. However, other jurisdictions such as the United States are beginning to think about equity crowdfunding: raising capital for small businesses or creative projects via an online funding portal by selling securities like shares, limited partnership units and promissory notes.

 Under the FCAA proposal, which may launch as early as the fall:

 The Business:

  • Could issue up to $200,000 of securities in fundraising tranches of up to $100,000 each
  • Would not be required to issue a prospectus but would be required instead to have an abbreviated offering document clearly explaining the basis of the offering (no additional details were provided)
  • Would have to raise sufficient funds to complete the project (ie. To meet its funding goal)
  • Would be required to report trades of securities to the FCAA within 30 days of the offerings close
  • Would be required to have its directors and officers sign and consent to a Canadian Police Information Centre check.

The Investor:

  • Would be able to invest a maximum of $1,000 per offering
  • Would be able to invest in as many offerings as the investor likes

 The Online Funding Portal:

  • Would not be required to register with the FCAA
  • Cannot provide investment advice

 For more information, please see this recent press release from the FCAA.

Seth B. Abbey, a corporate lawyer at Spiegel Sohmer with a focus on mergers and acquisitions, private equity financing and tax-driven reorganizations, is available to answer your questions about this and other topics.


Business Law