By Bernard Pinsky
On July 26, 2016, Alberta adopted a new exemption from its general requirement for issuers to clear and file a prospectus prior to issuing securities. The new exemption is found in ASC Rule 45-517 (the “Start-up Business Exemption”).
The Start-up Business Exemption is available for distributions of securities by Alberta issuers seeking to raise funds from Alberta investors. It can be used by issuers that wish to raise funds in a traditional manner, for example, through their contacts in the community or through a traditional registered dealer. It can also be used by issuers to crowdfund and raise funds via an online funding portal that is registered as a dealer.