The Government of Ontario has proposed changes that will negatively impact the ability of OREC and other co-ops to offer investment opportunities in the future.
With the Ontario government dissolving the Financial Services Commission of Ontario (FSCO), co-operative oversight, in particular pertaining to the sale of securities to support their missions, is being passed to the Ontario Securities Commission (OSC).
To borrow from our friends at Solar Share:
“This is short-sighted as there are essential differences between co-operatives who issue securities and other businesses. Co‑operatives are democratically controlled and funded by those who benefit from the services offered, and should not be regulated in the same manner as businesses driven by profit alone.”
Going forward, if these changes are enacted, OREC and other co-ops would have to produce an Offering Prospectus Memorandum, similar to large corporate institutions who offer securities. This is a time-consuming and costly document to produce, and one that would significantly hinder the ability of OREC and other co-ops to offer investment opportunities in the future.
If such a Memorandum were not to be produced, there would be significant limits upon the annual investment amounts for members. Additionally, holding OREC Shares within an RRSP, TFSA, or RESP, would become very difficult.
We urge you to contact your MPP and bring forward these concerns. The primary concern to bring forward is the following:
- Retain the Offering Statement process to continue to allow members like me to invest in co-ops
Find your MPP’s contact information here: https://www.ola.org/en/get-involved/contact-mpp
For more information:
- Read this letter from one of OREC’s founding members, Roger Peters.
- Take a look at the Ontario Co-operative Association’s notes on this issue.