Action Needed: The Future Of Solar Bonds
Feb 26, 2019
The Ontario Government is proposing legislative changes that will affect your ability to invest in SolarShare and other co-operatives.
The Ontario government is dissolving the Financial Services Commission of Ontario (FSCO), the regulatory agency for co-ops like SolarShare who issue securities to support their mission. Oversight of co-op securities is set to be handed off to the Ontario Securities Commission (OSC), the main regulator for investment issuers in the province. 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. Here is how this will affect SolarShare and you as a member:
- In order to issue Solar Bonds, SolarShare will have to create an Offering Prospectus Memorandum as if it were just like a large business like Royal Bank of Canada or Rogers. An Offering Memorandum is a much more intensive document than our current 100+ page Offering Statement and it is costly and laborious to produce. This burden is likely to impact our ability to offer Solar Bonds in future.
- If SolarShare does not produce a Memorandum, the OSC will enforce an annual investment limit per person of $10,000 for ineligible investors, and $30,000 for eligible investors. Many of you hold much more than these limits in Solar Bonds; our ability to accept investments exceeding those limits in future would be severely restricted.
- Holding Solar Bonds in an RRSP or TFSA would become even more restrictive without a receipted Offering Statement.
The Ministry of Finance has just advanced the cut-off date of this decision.
What you can do!
Call and write your MPP today and request a discussion or a face-to-face meeting. The key question to ask is:
“Why is your government trying to impose unfair restrictions and limits on my co-op’s ability to raise capital from its members like me? The proposed change will not allow me to continue to invest again as I did in the past. I know there are many more members like me who are frustrated by this news. Please reconsider.”