TSXV Announces Changes to Capital Pool Company Policies

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Categories: Blog, Securities

On December 1, 2020 the TSX Venture Exchange (the “Exchange”) announced long awaited changes to its Capital Pool Company (“CPC”) program. The revised program is intended to increase the flexibility of the CPC program, reduce regulatory burdens and improve the economics for CPC participants.

Below is a summary of the key changes to the program.  For a comprehensive list of all changes please see this link.

  1. Increase in Capital Raising Thresholds.
  2. Capital limits have been increased from $500,000 to $1,000,000 in respect of seed capital raised below the IPO price and from $5,000,000 to $10,000,000 in aggregate funding.  The increased limits should give CPCs more flexibility when pursuing targets.

  3. Removal of the 24 Month Timeframe for Completing a Qualifying Transaction.
  4. Under existing CPC program, issuers that fail to complete a Qualifying Transaction within 24 months are downgraded to the NEX board of the Exchange.  This 24 month window has been eliminated under the new CPC policy.

  5. Easing of residency restrictions for Directors and Officers.
  6. The new CPC policy eases residency restrictions on directors and officers, allowing for the inclusion of international directors, as long as the majority of the management team is from Canada or the United States.

  7. Reduced Escrow Restrictions on Founders.
  8. The new CPC policy has reduced the escrow restrictions on founders and seed capital investors from a 36 month restriction to an 18 month restriction.

  9. Reduced Minimum Distribution Requirements

The new CPC policy provides for reduced minimum requirements for share distributions. Specifically, CPCs will now only need a public float of at least 500,000 shares (compared to 1,000,000 previously) and a minimum of 150 shareholders (compared to 200 previously).

Transitional Provisions

The revised CPC Program will take effect on January 1, 2021, however existing CPCs can take advantage of certain provisions of the program depending on where they are at in their lifecycle and subject to complying with certain transitional requirements.

If you are interested in learning more about Capital Pool Companies, taking your existing company public, or if you have other questions concerning your company’s compliance with securities laws, please contact Keith Inman at inman@pushormitchell.com or by phone at 250-869-1195 or Brendan Bachewich at bachewich@pushormitchell.com or by phone at 250-869-1122


Keith Inman is a securities and M&A lawyer with broad experience in capital markets. Keith regularly advises individuals and companies with respect to capital raises, securities reporting and compliance matters, purchases and sales of businesses and other corporate/commercial matters. Keith has advised numerous emerging and growth companies through the go-public process (including IPOs and RTOs) and has been a founder and director of multiple Capital Pool Companies.