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COVID-19 Update

On 19 March 2020, the Province of New Brunswick declared a state of emergency under section 12 of the Emergency Measures Act to enhance measures to contain the spread of COVID-19 (the novel coronavirus).
 
Though we are taking measures to respond to COVID-19 and these measures may increase normal response times, we are continuing to operate, with emphasis on maintaining key functionality.

We have asked most of our staff to work from home and they continue to be available by email, phone, conference calls and, in some cases, video conferences to support you. All essential and core operations will continue, although most will be delivered remotely. We are in an evolving situation and understand that many businesses are operating remotely.

We will endeavor to do our best in responding to communications from our stakeholders, however, we ask that you be patient as it may take us additional time to process your request.

At this time, we encourage you to contact us by email or by phone only, as we may not be able to respond to correspondence received by mail or by fax during this period.

As this is a very fluid situation, we are continuing to adapt as the situation develops. Please check our website for updates as this situation unfolds.

Licensing and Registration

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. Any licence or registration valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province. Please refer to the Regulated Industries Information below for how this impacts your specific industry.

Licensing and registration functions by FCNB will continue; however, there may be some delays.

Scheduled Compliance Reviews

All on-site compliance reviews are currently postponed.

Desk reviews will re-commence the week of 18 May 2020.


REGULATED INDUSTRIES INFORMATION

Insurance
Pension Plans
Credit Unions
Cooperatives
Securities
Direct Sellers
Mortgage Brokers
Real Estate
Pre-arranged Funeral Providers
Collection & Debt Settlement Services
Cost of Credit Disclosure & Payday Loans
Auctioneers
Credit Reporting


Insurance

We have taken measures to ease administrative burdens on industry so that priority can be given to servicing increased consumer needs. Read our letter to industry members. 

Annual statements on market conduct

Through the Canadian Council of Insurance Regulators (CCIR), reporting dates for Annual Statements on Market Conduct have been revised and extended to 1 July 2020.

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the  province. This means all insurance agent, broker, adjuster or damage appraiser licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.

Licensing functions remain available through the online portal for those who wish to renew their individual licence or apply for a new licence. For inquiries related to new Insurer licences or renewals, please contact insurance.licensing@fcnb.ca, as our office will accept the required forms via email.

Registered mail notifications

Several provisions under the Insurance Act require notification or delivery by registered mail. It is our understanding that, at this time, registered mail remains available through Canada Post. Although Canada Post has, and may continue to, modify its procedures for registered mail, this remains an option for meeting that statutory requirement. We would encourage you to monitor updates from Canada Post. Alternatively, please consult the Electronic Transactions Act for guidance on how to effect electronic delivery.   

Insurer Annual General Meetings (AGM)

Any New Brunswick incorporated insurers planning to hold annual general meetings (AGMs) in the near future should either postpone or hold the meeting virtually. In person AGMs at this time could result in large public meetings, which would be contrary to current public health advice.

Insurance courses/exams

Given recommendations related to COVID-19 pandemic with respect to social distancing and limiting gathering in large groups, FCNB has suspended the LLQP exam sessions until further notice. For those impacted by these cancellations, certification for LLQP candidates has been extended to 31 December 2020. 

Consultations

FCNB has extended the comment period for our consultation paper on diagnostic and treatment protocols to 18 June 2020.  

Helpful Links:

http://www.ibc.ca/bc/business/covid-19
https://www.insuranceinstitute.ca/en/about-the-institute/COVID-19
https://www.canadianunderwriter.ca/
https://www.nbinsurancebrokers.ca/Covid-19_Updates.html
https://www.clhia.ca/
https://www.ccir-ccrra.org/Documents/View/3585
https://www.cisro-ocra.com/Documents/View/2331
http://www.ibc.ca/on/resources/media-centre/media-releases/insurers-com…
https://www.insuranceinstitute.ca/en/about-the-institute/COVID-19
http://www.ibc.ca/qc/resources/media-centre/media-releases/insurers-reducing-insurance-costs-for-canadians-ibc-member-companies-offer-substantial-consumer-relief-measures


Pension Plans

Defined Contribution Pension Plans

Employers and employees are required to make contributions to defined contribution (DC) pension plans in accordance with the pension plan documents, the Pension Benefits Act and its regulations as well as the federal Income Tax Act and its regulations. The Minister of National Revenue recently announced that the normal minimum contribution rule (i.e. employer must contribute 1% of total pensionable earnings of all active participating members each year) will be waived for the remainder of 2020 if the plan is amended to suspend accruals under the plan for the year. This was done as a temporary relief measure during the Covid-19 pandemic and the resulting economic difficulties facing many employers and employees.  

If an employer would like to suspend contributions for the remainder of 2020, it can be done on a go-forward basis by making an amendment to the pension plan and filing it for approval with FCNB.  Before making any amendments, pension plan administrators should consider any applicable provisions of a collective agreement, member notice requirements and any other employment or pension law considerations.  

Also, please be aware that in certain circumstances, plan amendments may not be needed. For example, pension plans where member contributions are optional or when contributions are based on earnings and there are no earnings due to a layoff.  

Provided they have filed the appropriate amendment, the Superintendent of Pensions will not order a plan to be wound up pursuant to subsection 61(1) of the Pension Benefits Act solely because an employer temporarily ceased contributions for a portion of the 2020 calendar year as a result of the Covid-19 economic disruption.

Annual Information Returns

Pursuant to section 81 of the Pension Benefits Act, the Superintendent has extended the time limit for filing any Annual Information Returns (AIRs) due to be filed on or before 30 June 2020 by 90 days. This replaces the earlier extension of any AIRS that were due by 30 April 2020. The Superintendent is satisfied that the current State of Emergency declared in the Province of New Brunswick is reasonable grounds to extend this time limit.

Annual Written Statements to Members

Pursuant to section 81 of the Pension Benefits Act, the Superintendent has extended the time limit for providing annual written statements to members due on or before 30 June 2020 by 90 days. The Superintendent is satisfied that the current State of Emergency declared in the Province of New Brunswick is reasonable grounds to extend this time limit. 

Actuarial Valuation Reports and Cost Certificates

Pursuant to section 81 of the Pension Benefits Act, the Superintendent has extended the time limit for filing any Actuarial Valuation Reports (AVRs) and Cost Certificates due to be filed on or before 30 September 2020 by 90 days. This replaces the earlier extension of any AVRs that were due by 30 April 2020. The Superintendent is satisfied that the current State of Emergency declared in the Province of New Brunswick is reasonable grounds to extend these time limits. Pension plan administrators are reminded that under subsections 9(1) and 9(3.11) of the General Regulation - Pension Benefits Act, the review date of an AVR must be no more than three (3) years (or no more than 12 months, if the transfer ratio of the plan is less than 90%) after the review date of the immediately preceding AVR. 

Transfer Ratio or Termination Value Funded Ratios

The Financial and Consumer Services Commission reminds all pension plan administrators that pursuant to subsection 19(7) of the General Regulation – Pension Benefits Act and subsection 18(2) of the Shared Risk Plans Regulation – Pension Benefits Act, if there is reason to believe that the transfer ratio or termination value funded ratio of the plan has been reduced by more than 10% overall (for example, from 90% to 80%) since the review date of the most recently filed AVR, the administrator shall not transfer the commuted value (or termination value for a shared risk plan) unless, after recalculation, the transfer can be carried out under subsection 19(10) or 19(11) of the General Regulation – Pension Benefits Act or is approved by the Superintendent under section 37 of the Pension Benefits Act. Given the current volatility of the markets, the Superintendent is of the opinion that all plan administrators have reason to believe that the transfer ratio or termination value funded ratio has been reduced by more than 10%, and therefore must closely monitor the transfer ratio of the plan. The Superintendent has deemed it reasonable for pension plan administrators to monitor and, if necessary recalculate, these ratios on a quarterly basis. If the transfer ratio or termination value funded ratio has not been reduced by at least 10%, the previously calculated ratio can be used for the transfer. This is not a hold on transfers but rather a reminder of the requirement to recalculate the transfer ratio or termination value funded ratio prior to transferring funds if the transfer ratio has been reduced by at least 10%. Recalculations should be done as soon as possible to avoid delays with transfers. Approval by the Superintendent is not required if the transfer can be carried out under subsection 19(10) or 19(11). If the transfer ratio or termination value funded ratio has been reduced by at least 10%, a new transfer ratio or termination value funded ratio must be calculated and documented in a cost certificate prior to transfers taking place. Although the cost certificate must be filed with the Superintendent, the newly calculated transfer ratio or termination value funded ratio may be utilized once filed. Pension plan administrators are expected to monitor the transfer ratio and adjust as needed on a quarterly basis.  

Forms Requiring a Commissioner of Oaths or Notary Public

For any form requiring a signature before a Commissioner of Oaths, please be advised that some lawyers in New Brunswick may now be able to commission documents via video conference as set out on the Law Society’s website. All lawyers in New Brunswick are Commissioners of Oaths. If you are experiencing issues with the witnessing of any FCNB pension-related form, please contact FCNB at info@fcnb.ca.

Minimum Withdrawals

The federal government has announced that it will reduce the minimum withdrawal rate from Registered Retirement Income Funds (RRIFs) in 2020 by 25%. The minimum payment as set out in the General Regulation – Pension Benefits Act for Life Income Funds (LIFs) is currently higher than the minimum as set out by the federal government. We are aware of this difference and we are reviewing policy options.   



Credit Unions

Credit Unions Annual General Meetings (AGMs)

Due to the state of emergency in New Brunswick and the emergency order issued under section 12 of the Emergency Measures Act, the Superintendent of Credit Unions will issue an extension requested under subsection 79(2) of the Credit Unions Act for a Credit Union to extend the time for meetings that are required under the Credit Unions Act to be held prior to 31 May 2020.

Credit Unions Loan Payment Relief Programs

Effective immediately, the Superintendent of Credit Unions has approved programs proposed by Credit Unions to offer loan payment relief to their members. Members requiring more information and/or assistance are asked to contact their local credit union.



Cooperatives

Cooperatives Annual General Meetings (AGMs)

The Director of Cooperatives understands that due to the state of emergency in New Brunswick, Annual General Meetings that are required to be held under the Cooperatives Act cannot be held for at least the duration of the state of emergency. The Director of Cooperatives stresses that it is critical that we ensure compliance with the Emergency Measures Act and do all that we can to facilitate social distancing.  The Financial and Consumer Services Commission is working with the provincial government and will be providing further information to cooperatives on options for Annual General Meetings.

Consultations

We had planned to do some in-person communications with our Cooperatives about the new regulations that took effect 1 January. However, all in-person outreach sessions have been postponed and will be rescheduled at a future date.



Securities

The Canadian Securities Administrators (CSA) have released a number of communications relating to the impact of COVID-19 on its market participants. Please click here for further information. We encourage market participants to check regularly for ongoing updates.   

Regulatory Filings

The CSA have provided temporary blanket relief for market participants from certain regulatory filings as a result of COVID-19. The blanket orders can be viewed here. They include:

  • 21-507: Temporary Exemption from Certain Reporting Requirements for Regulated Entities Carrying on Business in New Brunswick
  • 31-531: Temporary Exemption from Certain Financial Statement and Information Delivery Requirements for Registrants
  • 31-532: Relief in Respect of Client Focused Reforms Conflict of Interest Provisions of NI 31-103
  • 31-533: Relief in Respect of Client Focused Reforms Relationship Disclosure Information Provisions of NI 31-103
  • 31-534 Temporary Exemption from Certain Financial Statement and Information Delivery Requirements for Registrants with Deadlines During the Period from 2 June to 30 September 2020
  • 51-507: Temporary Exemption from Certain Corporate Finance Requirements
  • 51-508: Temporary Exemptions from Certain Requirements to File or Send Security Holder Materials
  • 51-509: Temporary Exemption from Certain Corporate Finance Requirements with Deadlines During the Period from 2 June to 31 August 2020 
  • 81-506: Extension of Certain Filing, Delivery and Prospectus Renewal Requirements of Investment Funds
  • 81-507: Temporary Exemption from Borrowing Limit to Accommodate Redemption Requests of Mutual Funds Investing in Fixed Income Securities
  • 81-508: Extension of Certain Filing, Delivery and Prospectus Renewal Requirements of Investment Funds with Deadlines During the Period from 2 June to 30 September 2020

CSA Staff Notice 51-360 FAQs Regarding Filing Extension Granted by Way of a Blanket Order to COVID-19 provides interpretative guidance for the blanket orders 51-507 and 51-508.

COVID-19 Disclosure Considerations

The COVID-19 pandemic has had a significant impact on many issuers’ operations, financial condition, cash flows and financial performance. This CSA document provides information and guidance on disclosing and reporting on the effects of the COVID-19 pandemic, including:
•    Liquidity and capital resources
•    Significant judgments and estimation uncertainty
•    Impairment considerations for non-financial assets
•    Non-GAAP financial measures
•    Risk factor disclosure
•    Material change reporting
•    Forward-looking information

For questions, please contact Joe Adair, Senior Securities Analyst at FCNB, at 1-866-933-2222.
 

Registration

Registered firms and individuals pay an annual fee on 31 December to maintain their registration for the following year. Therefore, an extension is not required for registered firms and individuals as their registration is valid until 31 December 2020, at which time (or prior to) they may choose to maintain or cancel their registration. 



Direct Sellers

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all direct sellers licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.  



Mortgage Brokers

Fees and filings

Under section 3 of the Mortgage Brokers Act, the Director may exempt any person from any provision of the regulations if she considers it appropriate to do so. The Director is satisfied that the current State of Emergency declared in the Province of New Brunswick is reasonable grounds to extend these time limits. Therefore, Pursuant to section 3 of the Mortgage Brokers Act, the Director hereby extends the time limit for filing any Annual Returns due to be filed prior to 31 March 2020 by 60 days, to 31 May 2020. 

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all mortgage broker licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.



Real Estate

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all real estate licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.



Pre-arranged Funeral Providers

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all pre-arranged funeral provider and manager’s licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.



Collection & Debt Settlement Services

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all collection agencies and collectors licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.



Cost of Credit Disclosure & Payday Loans

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all payday lender licences and credit grantor, credit broker and lessor registrations valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.



Auctioneers

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all auctioneer licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.



Credit Reporting

Licensing

The province’s emergency measures order has extended all licences, registrations, certificates and permits issued by the province. This means all credit reporting licences valid as of 16 March 2020 will remain valid until 30 June 2020 unless suspended by a court or by another authority under an Act of the Province.