39 Special Considerations for International Companies The Exchanges welcome companies from around the world. However, non-Canadian companies do have some additional issues to consider in preparing to list on TSX or TSXV. The first issue to consider is what your company is defined as for the purposes of Canadian securities law – and in particular, if you are considered a non-Canadian company, or “foreign reporting issuer”. Generally speaking, your company will qualify as a foreign issuer if: • it is not incorporated or organized under the laws of Canada or a jurisdiction in Canada; • Canadian residents do not own more than 50% of the votes for an election of the directors, directly or indirectly; • the majority of your senior officers or directors are not residents of Canada; • less than 50% of your company’s assets are located in Canada; and • your company’s business is administered principally outside Canada. If your company qualifies as a foreign reporting issuer, it may also fall into one of three additional categories: (See National Instrument 71-102 - Continuous Disclosure and Other Exemptions Relating to Foreign Issuers). SEC foreign issuer These are foreign reporting issuers that have a class of securities registered with, or reporting to, the SEC. Designated foreign issuer These are foreign reporting issuers who have less than 10% ownership in Canada and who are subject to foreign disclosure requirements in: • Australia • France • Germany • Hong Kong • Italy • Japan • Mexico • The Netherlands • New Zealand • Singapore • South Africa • Spain • Sweden • Switzerland • United Kingdom Other foreign issuer An issuer that is incorporated or organized under the laws of a foreign jurisdiction, unless outstanding voting securities of the issuer carrying more than 50% of the votes for the election of directors are beneficially owned by residents of Canada, and any of the following apply: • the majority of the executive officers or directors of the issuer are residents of Canada; • more than 50% of the consolidated assets of the issuer are located in Canada; or • the business of the issuer is administered principally in Canada. Though the specific answer will vary depending on which category or categories apply to your company, and depending on your company’s unique situation, all international companies looking at listing in Canada will have to consider: • How can I make sure my financial statements are in line with Canadian requirements? • How can I make sure my auditor meets appropriate standards? • What reporting and disclosure requirements will – and won’t – I be subject to once my company is listed in Canada?
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