FINANCIAL INSTITUTIONS ACT (2024)

FINANCIAL INSTITUTIONS ACT — continued

[RSBC 1996] CHAPTER 141

Part 3 — Business Authorization and Business

Division 1 — Business Authorization of Financial Institution

Section 059 — Commencement of business

59 (1) A trust company or credit union must not carry on trust business or deposit business unless authorized to do so by a business authorization issued to it under this Division.

(2) An insurance company must not carry on insurance business unless authorized to do so by a business authorization issued to it under this Division.

(3) A business authorization issued to a trust company may be confined to trust business or to deposit business or may authorize both trust business and deposit business.

(4) A business authorization issued to an insurance company

(a) may be confined to

(i) general insurance business or life insurance business, or

(ii) one or more classes of insurance, or

(b) may authorize both general insurance business and life insurance business.

(5) A business authorization issued to a credit union may be confined to deposit business or may authorize both deposit business and trust business.

Section 060 — Business authorizations for corporations now in business

60 (1) Without the necessity of an application, a credit union incorporated or amalgamated under the Credit Union Act, R.S.B.C. 1979, c. 69, is deemed to have a business authorization, issued under this Division on September 15, 1990, to carry on deposit business.

(2) On application under section 61 (5) of a credit union described in subsection (1), the commission, if satisfied that the credit union

(a) was carrying on trust business immediately before September 15, 1990, and

(b) has the financial and managerial capacity to carry on trust business,

may issue to the credit union a business authorization to carry on both trust business and deposit business.

(3) Despite subsection (1) of this section and section 60 (1) and (2) of the Financial Institutions Act, S.B.C. 1989, c. 47, a restriction, limitation or condition

(a) imposed under a previous Act on a licence, a registration or the carrying on of any business of a financial institution, and

(b) still in effect immediately before September 15, 1990

remains in effect and is deemed to be a condition of the financial institution's business authorization, subject to a subsequent surrender of the business authori zation, and to any amendment or the suspension, revocation or cancellation of the business authorization, under this Act.

Section 061 — Application for business authorization

61 (1) A financial institution other than

(a) a financial institution described in section 60 (1) or (2) of the Financial Institutions Act, S.B.C. 1989, c. 47, or

(b) a society that is named in an order of the superintendent made under section 193 (2),

must file with the commission, within one year after the date of its incorporation under this Act or under the Credit Union Incorporation Act or its continuation into British Columbia, an application in the prescribed form for a business authorization.

(2) The commission, by order applicable to a financial institution named in it, may extend the period referred to in subsection (1) before or after the expiry of that period for a further period not exceeding 6 months, but not more than one order may be made in respect of the same financial institution.

(3) A society that is named in an order of the superintendent made under section 193 (2) must file with the commission, by a date not later than 30 days before the date specified under section 193 (2) (b) in the order under section 193 (2), an application in the prescribed form for a business authorization.

(4) On an amalgamation under section 26 of this Act or under section 20 or 21 of the Credit Union Incorporation Act, the amalgamated financial institution within 30 days after the date of amalgamation must file with the commission an application in the prescribed form for a business authorization.

(5) A credit union that has a business authorization confined to deposit business may file with the commission at any time an application in the prescribed form for a business authorization for the credit union to carry on both trust business and deposit business.

(6) A trust company that has a business authorization confined to deposit business or trust business may file with the commission at any time an application in the prescribed form for a business authorization for the trust company to carry on both trust business and deposit business.

(7) An insurance company that has a business authorization confined to

(a) general insurance business or life insurance business, or

(b) one or more classes of insurance

may file with the commission at any time an application in the prescribed form for a business authorization for the insurance company to carry on

(c) both general insurance business and life insurance business, or

(d) one or more additional classes of insurance.

(8) On application in accordance with this section, the commission may issue a business authorization to a financial institution if the commission is satisfied that

(a) the financial institution has a capital base that

(i) is adequate, taking into account the class of business that it proposes to carry on, the expected volume of its business and the restrictions on its business, and

(ii) is at least equal to the appropriate minimum imposed under section 68 (2),

(b) the financial institution has at least 5 directors and, in the case of a trust company or insurance company, at least 1/3 of the directors are unaffiliated directors,

(c) if the financial institution is a trust company that will carry on deposit business, it will not receive deposits of money unless

(i) it is a member of the Canada Deposit Insurance Corporation, or

(ii) a deposit insurer has been named by regulation for the purpose of this paragraph and the trust company maintains deposit insurance through that deposit insurer,

(A) in respect of those deposits with the trust company that can be insured with that deposit insurer, and

(B) in the maximum insurable amounts allowed under the insurance for those insurable deposits,

(d) if

(i) the financial institution is an insurance company that will carry on insurance business, and

(ii) there is an insurance compensation plan designated by regulation for the purpose of section 66 (2),

the financial institution that will carry on insurance business will not carry on a class of insurance business in respect of which insurance is offered under that plan unless the financial institution is a member of that plan, and

(e) the financial institution has a proposed plan of operations that is feasible.

(9) Before issuing a business authorization to a financial institution, the commission may

(a) conduct an investigation, and

(b) require the financial institution to provide the commission with additional information, verifications, forecasts of business operations or documents

that the commission considers necessary for the evaluation of the application.

Section 062 — Conditions on business authorization

62 If conditions of any class of business authorization are prescribed under section 289 (3) (g), the conditions are applicable to and are conclusively deemed to be part of every business authorization of that class, whether issued before or after the coming into force of the regulation prescribing the conditions.

Section 063 — Certificate of business authorization

63 A certificate of the commission that on a day stated in the certificate

(a) a financial institution was or was not authorized as set out in the certificate under a business authorization to carry on trust business, deposit business, insurance business, or both trust business and deposit business, or

(b) the business authorization of a financial institution was revoked

is evidence of the facts stated in the certificate.

Section 064 — Voluntary revocation of business authorization

64 (1) On the written application of a financial institution, the commission may revoke the financial institution's business authorization, effective on a date specified by the commission, and in that case sections 249 (8) and 250 apply.

(2) If a financial institution proposes to cease doing business, it must give the superintendent at least 30 days' written notice.

Division 2 — Operation of Financial Institutions

Section 065 — Authorized business

65 (1) Subject to section 20 (1) of this Act and to section 13 (1) of the Credit Union Incorporation Act, a financial institution that has a business authorization must not carry on business other than

(a) the business authorized under its business authorization,

(b) business that

(i) is ancillary to the business authorized under its business authorization, or

(ii) is a financial or related service that does not constitute business for which a business authorization is required, and

(c) business of a prescribed type.

(2) A contravention of this section does not affect or invalidate

(a) a transaction entered into by a financial institution, or

(b) a contractual right or civil remedy that a person may have in respect of such a transaction.

Section 066 — Membership in insurance plan

66 (1) A trust company must not carry on deposit business unless

(a) it is a member institution within the meaning of the Canada Deposit Insurance Corporation Act, or

(b) a deposit insurer has been named by regulation for the purpose of this paragraph and the trust company maintains deposit insurance through that deposit insurer

(i) in respect of those deposits with the trust company that can be insured with that deposit insurer, and

(ii) in the maximum insurable amounts allowed under that deposit insurance for those insurable deposits.

(2) If an insurance compensation plan has been designated by regulation for the purpose of this subsection, an insurance company must not carry on a class of insurance business in respect of which insurance is offered under that plan unless the insurance company is a member of that plan.

Section 067 — Liquidity

67 (1) In accordance with the regulations, a trust company authorized to carry on deposit business must ensure that at all times it has sufficient liquid assets in relation to the business carried on by it.

(2) In accordance with the regulations, a credit union must ensure that at all times it

(a) has sufficient liquid assets in relation to the business carried on by it, and

(b) keeps a prescribed percentage of its assets in the form of deposits with a central credit union specified by regulations.

Section 068 — Capital

68 (1) A financial institution must ensure that its capital base is at all times adequate in relation to the business carried on by the financial institution.

(2) Without limiting subsection (1),

(a) a trust company authorized to carry on deposit business or both trust business and deposit business must ensure that its capital base is at all times at least the greater of

(i) $5 million, or

(ii) the amount that constitutes an adequate capital base in accordance with the regulations,

(b) a trust company authorized to carry on trust business but not deposit business must ensure that its capital base is at all times at least the amount that constitutes an adequate capital base in accordance with the regulations,

(c) an insurance company authorized to carry on one or more classes of general insurance business but not authorized to carry on life insurance business must ensure that its capital base is at all times at least the greater of

(i) $3 million, or

(ii) the amount that constitutes an adequate capital base in accordance with the regulations,

(d) an insurance company authorized to carry on life insurance business or life insurance business together with accident and sickness insurance business but not general insurance business must ensure that its capital base is at all times at least the greater of

(i) $5 million, or

(ii) the amount that constitutes an adequate capital base in accordance with the regulations,

(e) an insurance company authorized to carry on both life insurance business and one or more classes of general insurance business except accident and sickness insurance business must ensure that its capital base is at all times at least the greater of

(i) $10 million, or

(ii) the amount that constitutes an adequate capital base in accordance with the regulations, and

(f) a credit union must ensure that its capital base is at all times at least the amount that constitutes an adequate capital base in accordance with the regulations.

(3) Without first receiving the written approval of the superintendent, a trust company or an insurance company must not

(a) redeem or purchase or otherwise acquire shares issued by it, or

(b) declare dividends, except a dividend in shares

if the redemption, purchase or other acquisition or the declaration would reduce the trust company's or insurance company's capital base to an amount less than the amount that constitutes an adequate capital base for that trust company or insurance company in accordance with the regulations under section 289 (3) (f).

(4) If the superintendent considers that the capital base of a financial institution is, or within one year will be, inadequate in relation to the business carried on by the financial institution, the superintendent may require by order that the financial institution increase its capital base to at least the amount, to be specified in the order, that the superintendent considers to be an adequate capital base under subsection (1) for that financial institution.

(5) An amount specified in an order of the superintendent under subsection (4) may be greater than the amount of the capital base that, without the order, would be required under subsection (2) for the financial institution for which the order is made.

Section 069 — Restriction on right to appoint receiver

69 (1) Unless it first receives the written consent of the minister, a financial institution must not grant to a person the right to appoint a receiver or a receiver manager of the property or business of the financial institution.

(2) The minister must not consent under subsection (1) if the minister believes on reasonable grounds that the person, in the public interest, ought not to be in a position to control or influence a financial institution.

Division 3 — Trust Business

Section 070 — Unauthorized trust business by corporations prohibited

70 A corporation must not carry on trust business in British Columbia unless the corporation is

(a) a trust company, an extraprovincial trust corporation or a credit union that has a business authorization to carry on trust business,

(b) a law corporation as defined in section 89 of the Legal Profession Act,

(c) a personal law corporation referred to in section 89 of the Legal Profession Act, or

(d) a corporation that is carrying on the business of a trustee in bankruptcy, receiver, receiver manager or liquidator and that is licensed as a trustee in bankruptcy under the Bankruptcy and Insolvency Act (Canada).

Section 071 — Exemption for executors or administrators

71 The superintendent may order that section 70 does not apply to a corporation in respect of a will or estate if the corporation

(a) does not have a business authorization issued under section 160, and

(b) is

(i) an executor or trustee appointed out of British Columbia of a will, or

(ii) an administrator appointed out of British Columbia of an estate.

Section 072 — Common trust funds authorized

72 A trust company or credit union must keep any asset acquired or held in trust by it separate and distinct from the assets of the trust company or credit union not held in trust and must keep a separate account for each trust, but, unless the instrument creating a trust otherwise provides, a trust company or credit union may, subject to the regulations, co-mingle assets held in trust in a common trust fund for the purposes of investment.

Section 073 — Extent of liability

73 (1) Subject to the terms of the instrument creating a trust, the liability of a trust company or credit union to persons interested in an estate held by the trust company or credit union as executor, administrator, trustee, receiver, liquidator, assignee, guardian or committee is the same as if the estate were held by an individual in the like capacity, and the powers of the trust company or credit union are the same as the powers of an individual holding an estate in the like capacity.

(2) A trust company or credit union authorized to carry on trust business may be appointed

(a) a sole trustee, notwithstanding that but for this Act it would be necessary to appoint more than one trustee, or

(b) the holder of an office mentioned in subsection (1) jointly with another person,

and the appointment may be made whether the trustee is required under a deed, will or other instrument creating a trust or whether the appointment is under the Trustee Act or otherwise.

(3) Revocation of the business authorization of a trust company or credit union is sufficient cause to remove that company or credit union from an appointment or office held by it under this or another Act.

(4) Despite any rule, practice or statutory provision, it is not necessary for a trust company or credit union to give security for the due performance of its duty as executor, administrator, trustee, receiver, liquidator, assignee, guardian or committee unless so ordered by a court.

Section 074 — Execution of trusts

74 Unless the trust company or credit union is a trustee under the trust, a trust company or credit union is not bound to see to the execution of a trust, whether express, implied or constructive.

Division 4 — Insurance Business

Section 075 — Unauthorized insurance business prohibited

75 A person must not carry on insurance business in British Columbia unless the person is

(a) an insurance company or extraprovincial insurance corporation that has a business authorization to carry on insurance business,

(b) a company registered under the Insurance (Captive Company) Act,

(c) a member of a reciprocal exchange as defined in section 186 for which a permit under section 187 has been issued and is in effect,

(d) licensed under Division 2 of Part 6 as an insurance agent, insurance salesperson, insurance adjuster or employed insurance adjuster and is carrying on the insurance business only in that capacity,

(e) the deposit insurance corporation, the Canada Deposit Insurance Corporation or the Insurance Corporation of British Columbia,

(f) an insurer

(i) named by regulation for the purpose of section 61 (8) (c) (ii) or 66 (1) (b), or

(ii) that administers an insurance compensation plan designated by regulation for the purpose of section 66 (2),

(g) a society described in section 193 (1) (a) to (g) that, immediately before September 15, 1990, was carrying on the business of insurance,

(h) a credit union that is carrying on insurance business only by making or participating in contracts of insurance as permitted by section 82 of the Credit Union Incorporation Act, or

(i) a central credit union that is carrying on insurance business only by providing or arranging insurance as permitted by section 90 (2) of the Credit Union Incorporation Act.

Section 076 — Exceptions

76 (1) Despite section 75,

(a) any person may require insurance to be placed by a borrower as security for a loan,

(b) any person may

(i) adjust a loss,

(ii) prosecute or maintain a writ, action or proceeding, or

(iii) perform an obligation

under or arising out of a contract of insurance that was made or issued in British Columbia at a time when the person was authorized to carry on insurance business, and

(c) an insurance agent licensed under Division 2 of Part 6 who

(i) does not, directly or indirectly, solicit the resident for the insurance contract, and

(ii) is authorized by the resident to effect the insurance contract, may negotiate or procure an insurance contract between a resident of British Columbia and an insurer prohibited by section 75 from carrying on business in British Columbia.

(2) An insurance agent licensed under Division 2 of Part 6 who, under subsection (1) (c), procures or negotiates a contract of insurance must keep a record showing the particulars of the contract, and at the request of the Commissioner of Income Tax or of the superintendent, must provide the record to the commissioner or superintendent as requested.

(3) If

(a) the sum imposed by way of tax under section 4 of the Insurance Premium Tax Act in respect of an insurance contract lawfully made under subsection (1) (c) has been paid,

(b) the insurer described in subsection (1) (c) has notified the superintendent that it proposes to make an inspection for the purpose of the insurance contract or to adjust or appraise a loss under the contract, and

(c) the superintendent has given written approval to the proposed activity by the insurer,

the insurer may make the inspection or adjust and appraise the loss.

(4) The approval referred to in subsection (3) (c) is valid for all necessary inspections, adjustment and appraisals during the period specified in the approval.

(5) The superintendent may suspend, cancel or refuse to issue an approval referred to in subsection (3) (c) if an insurer contravenes a provision of this Act.

Section 077 — Reserves

77 An insurance company must value its claims liabilities and establish adequate reserves against those liabilities in accordance with the regulations.

Section 078 — Reinsurance

78 An insurance company, in accordance with the regulations, may reinsure its liability under, or interest in, a lawful contract, but must not do so through an insurer not licensed, registered or otherwise authorized to carry on the business of insurance in Canada, except within the prescribed limits.

Section 079 — Rebates of premiums prohibited

79 (1) A person, in relation to the sale of insurance, must not, directly or indirectly, pay or allow, or offer or agree to pay or allow, a rebate of premium or part of it or other consideration or thing of value intended to be in the nature of a rebate of premium or other gift, promotion or inducement to a person insured or applying for insurance in respect of life, person or property in British Columbia.

(2) This section does not apply to or in respect of

(a) a payment by way of dividend, of patronage allocation, of bonus or of profit that is provided for by a contract of insurance,

(b) a person who is licensed under Division 2 of Part 6 as an insurance agent or insurance salesperson and who negotiates for or procures insurance on the agent's or salesperson's own person or property, and receives for own use the regular agent's commission having first in good faith negotiated or placed insurance on other persons or property the premiums for which, in the aggregate, are not less than the aggregate of the premiums for the insurance negotiated or procured on the agent's or salesperson's own person or property, or

(c) the payment of a fee for a referral under section 178 (2).

Section 080 — Separation of class funds of insurance company

80 (1) An insurance company transacting more than one class of insurance business must

(a) keep separate accounts for each class, and

(b) account for all premiums and claims in relation to each class as a separate fund.

(2) The investments of a separate fund kept under subsection (1) need not be kept separate from the investments of another fund.

Division 5 — Deposits and Borrowing of Trust Companies and Credit Unions

Section 081 — Unauthorized deposit business prohibited

81 (1) A person must not carry on deposit business in British Columbia unless the person is

(a) a trust company or extraprovincial trust corporation that has a business authorization to carry on deposit business,

(b) a credit union that has a business authorization to carry on deposit business,

(c) a bank, or

(d) a corporation that is a subsidiary of a bank and is a loan company to which the Trust and Loan Companies Act (Canada) applies.

(2) Subsection (1) does not prohibit an insurance company or extraprovincial insurance company from carrying on life insurance business in accordance with a business authorization issued to it.

Section 082 — Deposits in credit unions

82 (1) A credit union may receive money on deposit only from, or on behalf of,

(a) its members,

(b) the government of Canada,

(c) the government of British Columbia,

(d) a public body,

(e) any 2 or more members jointly on behalf of a partnership or an unincorporated association if the directors of the credit union are satisfied that a majority of the members of the association or partnership are persons who are eligible for membership in the credit union,

(f) a member acting as trustee, whether for a named beneficiary or otherwise,

(g) a member in joint ownership with another person,

(h) a person, including the credit union, acting as trustee or agent as permitted by this Act, and

(i) a person in a prescribed class of persons,

and the credit union may allow interest on deposits at a rate and in the manner determined by its directors.

(2) A deposit permitted under subsection (1) (e) may be recorded in the books of the credit union in the name of the unincorporated association or partnership, and the credit union is not obliged to

(a) see to the application of the money so deposited or any interest on it, whether or not it has notice of any trust, or

(b) determine the powers of the members, the association or the partnership, and the association or partnership or a member of the association or partnership is not entitled to notice of, to be represented at or to vote at meetings of the credit union.

Section 083 — Deposits from persons unable to contract

83 A trust company or credit union, without the intervention of any other person being required, may

(a) accept a deposit from any person whether or not the person is qualified by law to enter into ordinary contracts, and

(b) pay any or all of the principal of the deposit and any or all of the interest to the order of the person.

Section 084 — Disposition of deposits

84 (1) A person who has deposits with a trust company or deposits, non-equity shares or both with a credit union that do not exceed $10 000 may nominate a person in writing to receive the amount at the death of the depositor.

(2) On receiving an affidavit showing that a person who has made a nomination under subsection (1) has died, the trust company or credit union must substitute on its books the name of the nominee in place of the name of the person or must pay to the nominee the amount due in accordance with the instructions of the nominee.

(3) A payment by a trust company or credit union in accordance with this section is valid and effectual discharge of the trust company or credit union with respect to a demand by a person against the trust company or credit union as to the amount paid.

Section 085 — Inactive deposits

85 (1) If a debt is owing by a trust company or credit union because of a deposit and no transaction has taken place and no statement of account has been requested or acknowledged by the creditor during a period of 10 years,

(a) in the case of a deposit made for a fixed period, from the day on which the fixed period terminated, and

(b) in the case of any other deposit, from the day on which the last transaction took place or a statement of account was last requested or acknowledged by the creditor, whichever is later,

then, the debt is an inactive deposit for the purposes of this section.

(2) If the amount of an inactive deposit, including interest, is less than $100, then, subject to subsection (6), the trust company or credit union may treat it as income of the trust company or credit union.

(3) If the amount of an inactive deposit, including interest, is $100 or more, then, within 30 days after the debt becomes an inactive deposit, the trust company or credit union must mail written notice to the depositor, at the depositor's last address known to the trust company or credit union, informing the depositor that the debt has become an inactive deposit and will be dealt with under this section if the depositor does not, within 30 days after the date of the notice, give instructions as to the disposition of the deposit.

(4) If, under subsection (3), a trust company or credit union mails written notice to its depositor and does not, within 30 days after the date of the notice, receive instructions from its depositor as to the disposition of the deposit, then the trust company or credit union must pay to the Minister of Finance and Corporate Relations an amount equal to the debt, including interest if any, in accordance with the terms and conditions of the debt, and the payment discharges the trust company or credit union from all liability to the creditor in respect of the debt and interest.

(5) If payment has been made to the Minister of Finance and Corporate Relations under subsection (4) with respect to a debt and payment is demanded at the Ministry of Finance and Corporate Relations by the person who, but for that subsection, would be entitled to receive payment of the debt, the Minister of Finance and Corporate Relations must pay to that person from the consolidated revenue fund

(a) an amount equal to the amount paid to the Minister of Finance and Corporate Relations under subsection (4), and

(b) if interest was payable in accordance with the terms and conditions of the debt or instrument, interest on the debt

(i) for the period not exceeding 20 years from the date payment was received by the Minister of Finance and Corporate Relations until the date of payment to the claimant, and

(ii) at the prescribed rate.

(6) If, under subsection (2), a trust company or credit union has treated a debt and interest as income and payment is demanded of the trust company or credit union by the person who, but for that subsection, would be entitled to receive payment of the debt, the trust company or credit union must pay to that person

(a) an amount equal to the amount so treated as income, and

(b) if interest was payable in accordance with the terms and conditions of the debt or instrument, interest on the amount so treated as income

(i) for the period not exceeding 5 years from the day on which the debt and interest were treated as income until the date of payment to the claimant, and

(ii) at the prescribed rate.

(7) If a trust company or credit union has under subsection (2) treated a debt and interest as income or under subsection (4) has paid an amount to the Minister of Finance and Corporate Relations, the trust company or credit union must keep all related signature cards and signing authorities or microfilm copies of them for a prescribed period after which the trust company or credit union may destroy them.

Section 086 — Limitation on lending

86 A trust company or credit union must not exercise its powers to lend money or guarantee an obligation at any time when it is in contravention of section 67.

Section 087 — Subordinated notes

87 (1) A trust company or credit union must not issue a note under which the indebtedness evidenced is subordinated in right of payment to all other indebtedness not evidenced by a subordinated note unless the note so issued meets each of the following requirements:

(a) the note is evidenced by a certificate in a form approved by the superintendent and contains a statement in it to the effect of the statements made in paragraphs (b) and (c) and contains the information that it is a subordinated note and contains any other information that the superintendent requires in approving the form of certificate;

(b) the borrowing evidenced by the note does not constitute a deposit of money with the trust company or credit union that issues the note and is not insured by the Canada Deposit Insurance Corporation, the deposit insurance corporation or a deposit insurer named by regulation for the purpose of section 61 (8) (c) (ii) or 66 (1) (b);

(c) in the event of the insolvency or winding up of the trust company or credit union, the indebtedness evidenced by the note is subordinated in right of payment to all other indebtedness that is not evidenced by a subordinated note.

(2) A trust company or credit union or person acting on behalf of a trust company or credit union, in any offering, circular, advertisem*nt, correspondence or literature relating to a subordinated note issued or to be issued, must not refer to the subordinated note otherwise than as a subordinated note, and the trust company or credit union must indicate clearly in the offering, circular, advertisem*nt, correspondence or literature that the money secured by the subordinated note is not an insured deposit.

Division 6 — Marketing of Financial Products

Section 088 — Definitions

88 In sections 90 (3) and 94 to 96, "transaction" means a transaction described in section 90 (1) or (2) entered into or arranged by a financial institution or arranged by a person acting with the financial institution's approval.

Section 089 — Use of "guarantee"

89 A person, in the course of conducting, soliciting or advertising deposit business, must not describe any investment or deposit as "guaranteed", or use the word "guarantee" or any derivative of it in a way that implies that the soundness of the investment or deposit is in any way protected, unless

(a) the investment or deposit is of a type insured by the Canada Deposit Insurance Corporation, the deposit insurance corporation or an insurer named by regulation for the purpose of section 61 (8) (c),

(b) the repayment of the full amount of the investment or of the deposit is guaranteed by another person

(i) who conducts business at arm's length from the entity

(A) that is the issuer of the security,

(B) that will hold the deposit, or

(C) in which or through which the investment is or is to be made,

(ii) whose identity is disclosed to the investor or depositor, and

(iii) who has been approved by the superintendent as a guarantor either for the purpose of that investment or deposit, or generally for the purpose of giving such guarantees,

(c) the full amount of the investment or of the deposit is guaranteed by Canada or a province, or

(d) that person is authorized to do so by the regulations.

Section 090 — Disclosure of identity to customers

90 (1) Subject to subsections (3) and (4), before

(a) a financial institution enters into a transaction, or

(b) a person acting with a financial institution's approval arranges a transaction

under which the financial institution provides a service or product to any person (the "customer"), the financial institution or the person acting on behalf of the financial institution, as the case may be, must disclose to the customer in writing

(c) that the transaction is between the customer and the financial institution, and

(d) other prescribed particulars.

(2) Subject to subsection (3), before

(a) a financial institution, or

(b) a person acting with a financial institution's approval in circ*mstances in which the person might reasonably be mistaken for an employee or representative of the financial institution

arranges a transaction under which a person other than the financial institution (the "third party") provides a service or product to any person (the "customer"), the financial institution or the person acting with the financial institution's approval, as the case may be, must disclose to the customer in writing

(c) that the transaction is between the customer and the third party, and

(d) other prescribed particulars.

(3) If, within the 60 days immediately before

(a) a transaction, or

(b) the first transaction in a series of similar transactions in which each follows another at an interval of not more than 60 days,

a financial institution or another person

(c) has entered into or arranged a similar previous transaction with the same customer, and

(d) in respect of that similar previous transaction, has made the disclosure required under subsection (1) or (2) to that customer,

then subsections (1) and (2) do not apply to or in respect of the transaction referred to in paragraph (a) or each transaction in the series of transactions described in paragraph (b), as the case may be.

(4) If a transaction described in subsection (1) is an oral contract arranged by a general insurance agent

(a) as a result of a customer's telephone request, and

(b) between the customer and an insurer that the agent has authority to bind under contracts of insurance,

then the agent may make the disclosure required under subsection (1) to the customer immediately after arranging the transaction.

Section 091 — Disclosure of identity in advertising, etc

91 In all advertising, correspondence, application forms, evidences of indebtedness and other documents in its control relating to its business, a financial institution must ensure that its identity is clearly stated.

Section 092 — Insurers to file policy forms

92 The superintendent may order an insurer to file a copy of any form that is specified or otherwise described in the order and is used or intended to be used by the insurer in its insurance business.

Section 093 — Prohibition against unfair forms of contract

93 (1) If, in the opinion of the superintendent, a form of contract in use between a financial institution and its customers or a form of application or advertisem*nt relating to such a contract is unfair, misleading or deceptive, the superintendent by order may prohibit the use of that form by a financial institution.

(2) If, in the opinion of the superintendent, an insurer is issuing contracts of insurance for less than fair market value, the superintendent may order the insurer to cease doing so.

Section 094 — Tied selling prohibited

94 A financial institution or person acting in the transaction with the approval of a financial institution must not require as a condition of any transaction that a person who receives a product or service under the transaction must transact additional or other business with the financial institution or other person providing the product or service, except in prescribed circ*mstances.

Section 095 — Confidentiality

95 (1) If, for the purpose of a transaction, a financial institution receives information pertaining to the customer's general insurance coverage or proposed general insurance coverage, then, even if the financial institution is authorized by the customer to communicate the information, the financial institution must not

(a) communicate any of the information to another person except as necessary in the performance of the financial institution's duty to the customer arising out of that transaction or a similar subsequent transaction between the financial institution and the same customer, or

(b) use the information for a purpose other than of that transaction or of a similar subsequent transaction between the financial institution and the same customer

unless the communication or use of the information is authorized or required by an enactment or in a court proceeding.

(2) If, for the purpose of a transaction, a financial institution receives information other than information pertaining to the customer's general insurance coverage or proposed general insurance coverage, then the financial institution must not

(a) communicate the information to another person except as necessary in the course of the financial institution's duty to the customer arising out of that transaction or a similar subsequent transaction between the financial institution and the same customer, or

(b) use the information for a purpose other than of that transaction or of a similar subsequent transaction between the financial institution and the same customer

unless the communication or use of the information is

(c) authorized or required by an enactment or in a court proceeding, or

(d) authorized in writing by the customer.

Section 096 — Substitute action of superintendent

96 (1) If the superintendent is satisfied that a customer, in respect of a transaction, has

(a) a cause of action,

(b) a defence to an action,

(c) grounds for setting aside a default judgment, or

(d) grounds for an appeal or to contest an appeal,

then, on behalf of the customer, the superintendent may institute or assume the conduct of any proceedings, or defend any proceedings, with a view to enforcing or protecting the rights of the customer respecting a contravention or suspected contravention of those rights or of any enactment or law relating to the protection or interests of customers.

(2) The superintendent must not institute, assume the conduct of or defend any proceedings under subsection (1) unless the superintendent

(a) considers that the conduct of the financial institution or other person involved in the transaction was misleading, deceptive or unconscionable, and

(b) first obtains

(i) the irrevocable written consent of the customer, and

(ii) the written consent of the minister.

(3) In respect of proceedings referred to in subsection (1),

(a) the superintendent, on behalf of the customer, has the same rights in and control over the proceedings, including the same right to settle an action or part of an action, as the customer,

(b) the superintendent, without consulting or seeking the further consent of the customer, may conduct the proceedings in the manner the superintendent considers appropriate, and

(c) any money, excluding costs, recovered by the superintendent belongs to and must be paid to the customer without deduction, and any amount, excluding costs, awarded against the customer must be paid by and is recoverable from the customer, but in every case any costs of the proceedings awarded by the court having jurisdiction must be borne by, or paid to and retained by, the superintendent, as the case may be.

(4) If

(a) a party to proceedings to which this section applies files a counterclaim, or

(b) the customer on whose behalf the proceedings are being defended is entitled to file a counterclaim,

and that counterclaim is not related to

(c) the cause of action, and

(d) the interests of the customer as a customer,

the court having jurisdiction in the proceedings must, on the application of the superintendent, order

(e) that the counterclaim be heard separately, and

(f) that the customer be made a party to the counterclaim in the customer's own right,

and the court may make other orders or give directions in that regard that it considers just.