Ontario Securities Commission launches initiatives to boost capital for early-stage businesses

New initiatives balance enhancing early-stage capital access with maintaining investor protections
Ontario Securities Commission launches initiatives to boost capital for early-stage businesses

The Ontario Securities Commission (OSC) unveiled a series of initiatives to boost capital-raising opportunities for early-stage businesses in Ontario through its OSC TestLab program.  

These initiatives, outlined in the notice of general orders, leverage testing to evaluate innovative capital market strategies and regulatory approaches in the province’s financial markets. OSC TestLab is designed to facilitate solution-focused testing in a controlled environment, addressing specific market issues and opportunities. By providing opportunities for the OSC and market participants to collaborate, TestLab aims to accelerate learning, reduce uncertainty, and establish a clearer basis for decision-making. 

“New and growing businesses play an essential role in our economy, contributing to job creation and driving productivity gains through innovation and competition,” said Grant Vingoe, chief executive officer of the OSC. “These initiatives reflect the OSC’s commitment to fostering the conditions for growth and innovation in Ontario’s capital markets without compromising investor protection, as outlined in our recently released strategic plan.” 

The new initiatives aim to strike a balance between enhancing access to early-stage capital and maintaining investor protections. They include an extension of the Self-Certified Investor Prospectus Exemption, dealer registration exemptions for early-stage businesses and not-for-profit angel investor groups and streamlined reporting of distributions by early-stage businesses. 

Leslie Byberg, executive vice president of Strategic Regulation, highlighted the significance of these measures, stating, “The OSC TestLab initiatives will provide important insights as we work to support access to finance at all stages of business growth. The data and information collected will help inform future policymaking, including promoting access to capital for early-stage businesses in Ontario while also ensuring investor protections.” 

Through TestLab, the OSC seeks to support responsible innovation and enable solutions that contribute to Ontario's competitive and innovative capital markets. Participants in TestLab can experiment with new products, services, and technologies and receive feedback to fine-tune their solutions. Additionally, businesses can test new regulatory approaches, with the OSC potentially offering time-limited exemptions from existing regulatory requirements during the testing period. 

The OSC will collect data to evaluate these initiatives and invite feedback from participating businesses, investors, and other key stakeholders in the early-stage capital-raising ecosystem. Detailed information on these initiatives is available on the Innovation Office website.