370. (1) In this Part,

“agent” means

(a) in relation to Her Majesty in right of Canada or of a province, any agent of Her Majesty in either of those rights and includes a municipal or public body empowered to perform a function of government in Canada or any entity empowered to perform a function or duty on behalf of Her Majesty in either of those rights, but does not include

(i) an official or entity performing a function or duty in connection with the administration or management of the estate or property of a natural person,

(ii) an official or entity performing a function or duty in connection with the administration, management or investment of a fund established to provide compensation, hospitalization, medical care, annuities, pensions or similar benefits to natural persons, or moneys derived from such a fund, or

(iii) the trustee of any trust for the administration of a fund to which Her Majesty in either of those rights contributes and of which an official or entity that is an agent of Her Majesty in either of those rights is a trustee, and

(b) in relation to the government of a foreign country or any political subdivision thereof, a person empowered to perform a function or duty on behalf of the government of the foreign country or political subdivision, other than a function or duty in connection with the administration or management of the estate or property of a natural person;

“eligible Canadian financial institution” means a Canadian financial institution that is a body corporate and that is widely held;

“eligible financial institution” means an eligible Canadian financial institution or an eligible foreign institution;

“eligible foreign institution” means

(a) a foreign bank that, in the opinion of the Minister, after consultation with the Superintendent, is regulated as or like a bank, according to the jurisdiction under whose laws it was incorporated or in any jurisdiction in which it carries on business, or

(b) a foreign institution that, in the opinion of the Minister,

(i) is, with respect to its provision of financial services, regulated in the jurisdiction under whose laws it was incorporated or in any jurisdiction in which it carries on business, and

(ii) is widely held;

“foreign institution” means an entity that is

(a) engaged in the trust, loan or insurance business, the business of a cooperative credit society or the business of dealing in securities, and

(b) incorporated or formed otherwise than by or under an Act of Parliament or the legislature of a province.

(2) to (4) [Repealed, 2001, c. 9, s. 96]

1991, c. 46, s. 370, c. 48, s. 494; 2001, c. 9, s. 96.

371. (1) For the purpose of determining ownership of a bank, where two persons who each beneficially own shares of a bank are associated with each other, those persons are deemed to be a single person who beneficially owns the aggregate number of shares of the bank beneficially owned by them.

(2) For the purposes of subsection (1), a person who beneficially owns shares of a bank is associated with another person who beneficially owns shares of the bank if

(a) one person is Her Majesty in right of Canada and the other person is Her Majesty in right of a province or one person is Her Majesty in right of a province and the other person is Her Majesty in right of another province;

(b) each person is an agent of Her Majesty in right of Canada or in right of a province;

(c) each person is an official, a trustee or an entity referred to in subparagraphs (a)(ii) and (iii) of the definition “agent” in subsection 370(1);

(d) each person is an entity owned or controlled by Her Majesty in right of Canada or in right of a province that is not an agent of Her Majesty and is not empowered to perform a function or duty on behalf of Her Majesty;

(e) both persons are trustees of any trusts for the administration of funds to which Her Majesty in right of Canada contributes and of which no official or entity that is an agent of Her Majesty in such right is a trustee;

(f) both persons are trustees of any trusts for the administration of funds to which Her Majesty in right of a particular province contributes and of which no official or entity that is an agent of Her Majesty in right of that province is a trustee;

(g) one person is a local cooperative credit society and the other person is a central cooperative credit society of which the first person is a member;

(h) both persons are local cooperative credit societies that are members of the same central cooperative credit society;

(i) one person is a central cooperative credit society, the other person is a federation of cooperative credit societies of which the first is a member, and both persons are incorporated or organized by or pursuant to legislation enacted by the same legislative body;

(j) both persons are central cooperative credit societies that are members of the same federation of cooperative credit societies, and both persons and the federation of cooperative credit societies are incorporated or organized by or pursuant to legislation enacted by the same legislative body; or

(k) both persons are associated within the meaning of paragraphs (a) to (j) with the same person.

1991, c. 46, s. 371; 2001, c. 9, s. 97.

372. Except as permitted by this Part, no person shall have a significant interest in any class of shares of a bank.

1991, c. 46, s. 372; 2001, c. 9, s. 98.

372.1 [Repealed, 2001, c. 9, s. 98]

373. (1) Subject to this Part, no person, or entity controlled by a person, shall, without the approval of the Minister, purchase or otherwise acquire any share of a bank or purchase or otherwise acquire control of any entity that holds any share of a bank if

(a) the acquisition would cause the person to have a significant interest in any class of shares of the bank; or

(b) where the person has a significant interest in a class of shares of the bank, the acquisition would increase the significant interest of the person in that class of shares.

(2) If, as a result of an amalgamation, merger or reorganization, the entity that results would have a significant interest in a class of shares of a bank, that entity is deemed to be acquiring a significant interest in that class of shares of the bank through an acquisition for which the approval of the Minister is required.

1991, c. 46, s. 373; 1994, c. 47, s. 17; 1997, c. 15, s. 37(E); 2001, c. 9, s. 98.

373.1 [Repealed, 1999, c. 28, s. 18]

374. (1) No person may be a major shareholder of a bank with equity of five billion dollars or more.

(2) Subsection (1) does not apply to a widely held bank that controls, within the meaning of paragraphs 3(1)(a) and (d), the bank with equity of five billion dollars or more if it controlled, within the meaning of those paragraphs, the bank on the day the bank’s equity reached five billion dollars and it has controlled, within the meaning of those paragraphs, the bank since that day.

(3) Subsection (1) does not apply to a widely held bank holding company that controls, within the meaning of paragraphs 3(1)(a) and (d), the bank with equity of five billion dollars or more if

(a) the bank holding company controlled, within the meaning of those paragraphs, the bank on the day the bank’s equity reached five billion dollars and it has controlled, within the meaning of those paragraphs, the bank since that day;

(b) the bank holding company acquired control, within the meaning of those paragraphs, of the bank under section 677 or 678 and the bank holding company has continued to control, within the meaning of those paragraphs, the bank since the day the bank holding company acquired control; or

(c) the bank was a subsidiary of another bank that was continued under section 684 as the bank holding company and the bank holding company has continued to control, within the meaning of those paragraphs, the bank since the day it came into existence as a bank holding company.

(4) Subsection (1) does not apply to any of the following that controls, within the meaning of paragraph 3(1)(d), the bank with equity of five billion dollars or more if it controlled, within the meaning of that paragraph, the bank on the day the bank’s equity reached five billion dollars and it has controlled, within the meaning of that paragraph, the bank since that day:

(a) a widely held insurance holding company;

(b) an eligible Canadian financial institution, other than a bank; or

(c) an eligible foreign institution.

(5) Subsection (1) does not apply to an entity that controls, within the meaning of paragraphs 3(1)(a) and (d), the bank with equity of five billion dollars or more if the entity is controlled, within the meaning of those paragraphs, by a widely held bank to which subsection (2) applies, or a widely held bank holding company to which subsection (3) applies, that controls the bank.

(6) Subsection (1) does not apply to an entity that controls, within the meaning of paragraph 3(1)(d), the bank with equity of five billion dollars or more if the entity is controlled, within the meaning of that paragraph, by

(a) a widely held insurance holding company to which subsection (4) applies that controls the bank;

(b) an eligible Canadian financial institution to which subsection (4) applies, other than a bank, that controls the bank; or

(c) an eligible foreign institution to which subsection (4) applies that controls the bank.

1991, c. 46, s. 374, c. 48, s. 494; 2001, c. 9, s. 98.

374.1 (1) Despite section 374, if a bank with equity of five billion dollars or more was formed as the result of an amalgamation, a person who is a major shareholder of the bank on the effective date of the letters patent of amalgamation shall do all things necessary to ensure that the person is no longer a major shareholder of the bank on the day that is one year after that day or on the day that is after any shorter period specified by the Minister.

(2) Subsection (1) does not apply to a widely held bank or a widely held bank holding company that controlled, within the meaning of paragraphs 3(1)(a) and (d), one of the applicants for the letters patent of amalgamation and that has controlled, within the meaning of those paragraphs, the amalgamated bank since the effective date of those letters patent.

(3) Subsection (1) does not apply to any of the following that controlled, within the meaning of paragraph 3(1)(d), one of the applicants for the letters patent of amalgamation if it has controlled, within the meaning of that paragraph, the amalgamated bank since the effective date of those letters patent:

(a) a widely held insurance holding company;

(b) an eligible Canadian financial institution, other than a bank; or

(c) an eligible foreign institution.

(4) Subsection (1) does not apply to an entity that controls, within the meaning of paragraphs 3(1)(a) and (d), the amalgamated bank if the entity is controlled, within the meaning of those paragraphs, by a widely held bank or widely held bank holding company to which subsection (2) applies that controls the amalgamated bank.

(5) Subsection (1) does not apply to an entity that controls, within the meaning of paragraph 3(1)(d), the amalgamated bank if the entity is controlled, within the meaning of that paragraph, by any of the following:

(a) a widely held insurance holding company to which subsection (3) applies that controls the amalgamated bank;

(b) an eligible Canadian financial institution to which subsection (3) applies, other than a bank, that controls the amalgamated bank; or

(c) an eligible foreign institution to which subsection (3) applies that controls the amalgamated bank.

(6) If general market conditions so warrant and the Minister is satisfied that the person has used the person’s best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which the person must comply with that subsection.

2001, c. 9, s. 98.

375. (1) If a person is a major shareholder of a bank with equity of less than five billion dollars and the bank’s equity reaches five billion dollars or more, the person shall do all things necessary to ensure that the person is not a major shareholder of the bank on the day that is three years after the day the bank’s equity reached five billion dollars.

(2) Subsection (1) does not apply if any of subsections 374(2) to (6) applies to the person in respect of the bank.

(3) If general market conditions so warrant and the Minister is satisfied that the person has used the person’s best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which the person must comply with that subsection.

1991, c. 46, s. 375; 2001, c. 9, s. 98.

376. (1) If a widely held bank with equity of five billion dollars or more controls another bank and a person becomes a major shareholder of the other bank or of any entity that also controls the other bank, the widely held bank must do all things necessary to ensure that, on the day that is one year after the person became a major shareholder of the other bank or entity that controls the other bank,

(a) the widely held bank no longer controls the other bank; or

(b) the other bank or the entity that controls the other bank does not have any major shareholder other than the widely held bank or any entity that the widely held bank controls.

(2) Subsection (1) does not apply in respect of a bank with equity of less than two hundred and fifty million dollars or any other amount that is prescribed.

(3) If general market conditions so warrant and the Minister is satisfied that the widely held bank has used its best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which it must comply with that subsection.

1991, c. 46, s. 376; 2001, c. 9, s. 98.

376.01 (1) Despite subsection 376(1), if a widely held bank with equity of five billion dollars or more controls a bank (in this subsection referred to as the “other bank”) in respect of which that subsection does not apply by reason of subsection 376(2) and the equity of the other bank reaches two hundred and fifty million dollars or more or any other amount that is prescribed and on the day the equity of the other bank reaches two hundred and fifty million dollars or more, or the prescribed amount, as the case may be, a person is a major shareholder of the other bank or of any entity that also controls the other bank, the widely held bank must do all things necessary to ensure that, on the day that is three years after that day,

(a) the widely held bank no longer controls the other bank; or

(b) the other bank or the entity that controls the other bank does not have any major shareholder other than the widely held bank or any entity that the widely held bank controls.

(2) If general market conditions so warrant and the Minister is satisfied that the widely held bank has used its best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which it must comply with that subsection.

2001, c. 9, s. 98.

376.1 No person who has a significant interest in any class of shares of a widely held bank with equity of five billion dollars or more may have a significant interest in any class of shares of a subsidiary of the widely held bank that is a bank or a bank holding company.

1991, c. 46, s. 578; 1997, c. 15, s. 39; 1999, c. 28, s. 19; 2001, c. 9, s. 98.

376.2 No person who has a significant interest in any class of shares of a bank may have a significant interest in any class of shares of any widely held bank with equity of five billion dollars or more, or of any widely held bank holding company with equity of five billion dollars or more, that controls the bank.

2001, c. 9, s. 98.

377. (1) No person shall control, within the meaning of paragraph 3(1)(d), a bank with equity of five billion dollars or more.

(2) Subsection (1) does not apply if any of subsections 374(2) to (6) applies to the person in respect of the bank.

1991, c. 46, s. 377; 2001, c. 9, s. 98.

377.1 No person shall, without the prior approval of the Minister, acquire control, within the meaning of paragraph 3(1)(d), of a bank with equity of less than five billion dollars.

2001, c. 9, s. 98.

378. (1) A bank that was named in Schedule I as that Schedule read immediately before the day section 184 of the Financial Consumer Agency of Canada Act comes into force and that had equity of less than five billion dollars on that day is deemed, for the purposes of sections 138, 156.09, 374, 376, 376.01, 376.1, 376.2, 377, 380 and 382, subsection 383(2), section 385 and subsection 396(2), to be a bank with equity of five billion dollars or more.

(2) Subsection (1) ceases to apply to a bank that continues to have equity of less than five billion dollars if the Minister specifies that it no longer applies to the bank.

1991, c. 46, s. 378; 2001, c. 9, s. 98.

378.1 No person may control or be a major shareholder of a bank if the person or an entity affiliated with the person

(a) has control of or has a substantial investment in an entity that engages in Canada in any personal property leasing activity that a financial leasing entity as defined in subsection 464(1) is prohibited from engaging in; or

(b) engages in Canada in any personal property leasing activity that a financial leasing entity as defined in subsection 464(1) is prohibited from engaging in.

1994, c. 47, s. 18; 2001, c. 9, s. 98.

378.2 No person who controls a bank or who is a major shareholder of a bank, and no entity affiliated with that person, may

(a) control or have a substantial investment in an entity that engages in Canada in any personal property leasing activity that a financial leasing entity as defined in subsection 464(1) is prohibited from engaging in; or

(b) engage in Canada in any personal property leasing activity that a financial leasing entity as defined in subsection 464(1) is prohibited from engaging in.

2001, c. 9, s. 98.

379. No bank shall, unless the acquisition of the share has been approved by the Minister, record in its securities register a transfer or issue of any share of the bank to any person or to any entity controlled by a person if

(a) the transfer or issue of the share would cause the person to have a significant interest in any class of shares of the bank; or

(b) where the person has a significant interest in a class of shares of the bank, the transfer or issue of the share would increase the significant interest of the person in that class of shares.

1991, c. 46, s. 379; 1997, c. 15, s. 40; 2001, c. 9, s. 98.

380. On application by a bank, other than a bank with equity of five billion dollars or more, the Superintendent may exempt any class of non-voting shares of the bank the aggregate book value of which is not more than 30 per cent of the aggregate book value of all the outstanding shares of the bank from the application of sections 373 and 379.

1991, c. 46, s. 380; 2001, c. 9, s. 98.

381. Despite section 379, if, as a result of a transfer or issue of shares of a class of shares of a bank to a person, the total number of shares of that class registered in the securities register of the bank in the name of that person would not exceed five thousand and would not exceed 0.1 per cent of the outstanding shares of that class, the bank is entitled to assume that no person is acquiring or increasing a significant interest in that class of shares of the bank as a result of that issue or transfer of shares.

1991, c. 46, s. 381; 2001, c. 9, s. 98.

382. (1) Despite sections 373 and 379, the approval of the Minister is not required in respect of a bank with equity of less than five billion dollars if a person with a significant interest in a class of shares of the bank, or an entity controlled by a person with a significant interest in a class of shares of the bank, purchases or otherwise acquires shares of that class, or acquires control of any entity that holds any share of that class, and the number of shares of that class purchased or otherwise acquired, or the acquisition of control of the entity, as the case may be, would not increase the significant interest of the person in that class of shares of the bank to a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever is applicable.

(2) Subject to subsection (3) and for the purpose of subsection (1), the percentage is 5 percentage points in excess of the significant interest of the person in that class of shares of the bank on the later of June 1, 1992 and the day of the most recent purchase or acquisition by the person or any entity controlled by the person, other than the entity referred to in subsection (1), of shares of that class of shares of the bank, or of control of an entity that held shares of that class of shares of the bank, for which approval was given by the Minister.

(3) If a person has a significant interest in a class of shares of a bank and the person’s percentage of that class has decreased after the date of the most recent purchase or other acquisition by the person or any entity controlled by the person, other than the entity referred to in subsection (1), of shares of that class of shares of the bank, or of control of an entity that held shares of that class of shares of the bank, for which approval was given by the Minister, the percentage for the purposes of subsection (1) is the percentage that is the lesser of

(a) 5 percentage points in excess of the significant interest of the person in that class of shares of the bank on the later of June 1, 1992 and the day of the most recent purchase or other acquisition by the person or any entity controlled by the person, other than the entity referred to in subsection (1), of shares of that class of shares of the bank, or of control of an entity that held shares of that class of shares of the bank, for which approval was given by the Minister, and

(b) 10 percentage points in excess of the lowest significant interest of the person in that class of shares of the bank at any time after the later of June 1, 1992 and the day of the most recent purchase or other acquisition by the person or any entity controlled by the person, other than the entity referred to in subsection (1), of shares of that class of shares of the bank, or of control of an entity that held shares of that class of shares of the bank, for which approval was given by the Minister.

(4) Subsection (1) does not apply if the purchase or other acquisition of shares or the acquisition of control referred to in that subsection would

(a) result in the acquisition of control of the bank by the person referred to in that subsection;

(b) if the person controls the bank but the voting rights attached to the aggregate of any voting shares of the bank beneficially owned by the person and by entities controlled by the person do not exceed 50 per cent of the voting rights attached to all of the outstanding voting shares of the bank, cause the voting rights attached to that aggregate to exceed 50 per cent of the voting rights attached to all of the outstanding voting shares of the bank;

(c) result in the acquisition of a significant interest in a class of shares of the bank by an entity controlled by the person and the acquisition of that investment is not exempted by the regulations; or

(d) result in an increase in a significant interest in a class of shares of the bank by an entity controlled by the person by a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever applies, and the increase is not exempted by the regulations.

(5) The Governor in Council may make regulations

(a) exempting from the application of paragraph (4)(c) the acquisition of a significant interest in a class of shares of the bank by an entity controlled by the person; and

(b) exempting from the application of paragraph (4)(d) an increase in a significant interest in a class of shares of the bank by an entity controlled by the person by a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever applies.

1991, c. 46, s. 382; 2001, c. 9, s. 98.

383. (1) Despite sections 373 and 379, the approval of the Minister is not required if

(a) the Superintendent has, by order, directed the bank to increase its capital and shares of the bank are issued and acquired in accordance with the terms and conditions, if any, that may be specified in the order; or

(b) a person who controls, within the meaning of paragraph 3(1)(a), the bank acquires additional shares of the bank.

(2) Paragraph (1)(a) does not apply in respect of a bank with equity of five billion dollars or more.

1991, c. 46, s. 383; 2001, c. 9, s. 98.

384. For the purposes of sections 373 and 379, the Minister may approve

(a) the purchase or other acquisition of any number or percentage of shares of a bank that may be required in a particular transaction or series of transactions; or

(b) the purchase or other acquisition of up to a specified number or percentage of shares of a bank within a specified period.

1991, c. 46, s. 384; 2001, c. 9, s. 98.

385. (1) Every bank with equity of one billion dollars or more but less than five billion dollars shall, from and after the day determined under this section in respect of that bank, have, and continue to have, voting shares that carry at least 35 per cent of the voting rights attached to all of the outstanding voting shares of the bank and that are

(a) shares of one or more classes of shares that are listed and posted for trading on a recognized stock exchange in Canada; and

(b) shares none of which is beneficially owned by a person who is a major shareholder of the bank in respect of the voting shares of the bank or by any entity that is controlled by a person who is a major shareholder of the bank in respect of such shares.

(2) The day referred to in subsection (1) is

(a) if the bank had equity of one billion dollars or more but less than five billion dollars on the day the bank came into existence, the day that is three years after that day; and

(b) in any other case, the day that is three years after the day of the first annual meeting of the shareholders of the bank held after the equity of the bank first reaches one billion dollars.

(3) If general market conditions so warrant and the Minister is satisfied that a bank has used its best efforts to be in compliance with this section on the day determined under subsection (2), the Minister may specify a later day as the day from and after which the bank must comply with subsection (1).

1991, c. 46, s. 385; 2001, c. 9, s. 98.

385.1 If a bank to which section 385 applies becomes a bank with equity of five billion dollars or more, that section continues to apply to the bank until no person is a major shareholder of the bank, other than a person to whom subsections 374(2) to (6) apply.

2001, c. 9, s. 98.

386. (1) Unless an exemption order with respect to the bank is granted under section 388, if a bank fails to comply with section 385 in any month, the Minister may, by order, require the bank not to have, until it complies with that section, average total assets in any three month period ending on the last day of a subsequent month exceeding the bank’s average total assets in the three month period ending on the last day of the month immediately before the month specified in the order.

(2) For the purposes of subsection (1), the average total assets of a bank in a three month period is to be computed by adding the total assets of the bank as calculated for the month end of each of the three months in the period and by dividing the sum by three.

(3) For the purposes of subsections (1) and (2), “total assets”, in respect of a bank, has the meaning given that expression by the regulations.

1991, c. 46, s. 386; 2001, c. 9, s. 98.

387. If the Superintendent has, by order, directed a bank with equity of one billion dollars or more but less than five billion dollars to increase its capital and shares of the bank are issued and acquired in accordance with any terms and conditions that may be specified in the order, section 385 does not apply in respect of the bank until the time that the Superintendent may, by order, specify.

1991, c. 46, s. 387; 2001, c. 9, s. 98.

388. (1) On application by a bank, the Minister may, if the Minister considers it appropriate to do so, by order exempt the bank from the requirements of section 385, subject to any terms and conditions that the Minister considers appropriate.

(2) If an exemption order granted under this section in respect of a bank expires, the bank shall comply with section 385 as of the day the exemption order expires.

(3) If a bank fails to comply with section 385 on the day referred to in subsection (2), the bank shall not, until it complies with that section, have average total assets in any three month period ending on the last day of a subsequent month exceeding the bank’s average total assets in the three month period ending on the last day of the month immediately before the day referred to in subsection (2) or any later day that the Minister may, by order, specify.

(4) Subsections 386(2) and (3) apply for the purposes of subsection (3).

1991, c. 46, s. 388; 1997, c. 15, s. 41; 2001, c. 9, s. 98.

389. (1) If a bank fails to comply with section 385 as the result of any of the following, section 386 does not apply in respect of the bank until the expiration of six months after the day it failed to comply with section 385:

(a) a distribution to the public of voting shares of the bank;

(b) a redemption or purchase of voting shares of the bank;

(c) the exercise of any option to acquire voting shares of the bank; or

(d) the conversion of any convertible securities into voting shares of the bank.

(2) If, as the result of an event that has occurred and is continuing, shares of a bank acquire voting rights in such number as to cause the bank to no longer be in compliance with section 385, section 386 does not apply in respect of that bank until the expiration of six months after the day the bank ceased to be in compliance with section 385 or any later day that the Minister may, by order, specify.

1991, c. 46, s. 389; 2001, c. 9, s. 98.

390. (1) Subject to subsection (2) and sections 379 and 391, section 385 does not apply in respect of a bank if a person acquires control of the bank through the purchase or other acquisition of all or any number of the shares of the bank by the person or by any entity controlled by the person.

(2) Subsection (1) applies only if the person referred to in that subsection provides the Minister with an undertaking satisfactory to the Minister to do all things necessary so that, within three years after the acquisition, or any other period that the Minister may specify, the bank has voting shares that carry at least 35 per cent of the voting rights attached to all of the outstanding voting shares of the bank and that are

(a) shares of one or more classes of shares that are listed and posted for trading on a recognized stock exchange in Canada; and

(b) shares none of which is beneficially owned by a person who is a major shareholder of the bank in respect of the voting shares of the bank or by any entity that is controlled by a person who is a major shareholder of the bank in respect of such shares.

1991, c. 46, s. 390; 1999, c. 28, s. 20; 2001, c. 9, s. 98.

391. At the expiration of the period for compliance with an undertaking referred to in subsection 390(2), section 385 shall apply in respect of the bank to which the undertaking relates.

1991, c. 46, s. 391; 2001, c. 9, s. 98.

392. (1) If, with respect to any bank, a particular person contravenes section 372, subsection 373(1), 374(1) or 375(1), section 376.1 or 376.2, subsection 377(1) or section 377.1 or fails to comply with an undertaking referred to in subsection 390(2) or with any term or condition imposed under section 397, no person, and no entity controlled by the particular person, shall, in person or by proxy, exercise any voting rights

(a) that are attached to shares of the bank beneficially owned by the particular person or any entity controlled by the particular person; or

(b) that are subject to an agreement entered into by the particular person, or any entity controlled by the particular person, pertaining to the exercise of the voting rights.

(2) Subsection (1) ceases to apply in respect of a person when, as the case may be,

(a) the shares to which the contravention relates have been disposed of;

(b) the person ceases to control the bank within the meaning of paragraph 3(1)(d);

(c) if the person failed to comply with an undertaking referred to in subsection 390(2), the bank complies with section 385; or

(d) if the person failed to comply with a term or condition imposed under section 397, the person complies with the term or condition.

(3) Despite subsection (1), if a person contravenes subsection 374(1) by reason only that, as a result of an event that has occurred and is continuing and is not within the control of the person, shares of the bank beneficially owned by the person or by any entity controlled by the person acquire voting rights in such number so as to cause the person to be a major shareholder of the bank, the Minister may, after consideration of the circumstances, permit the person and any entity controlled by the person to exercise voting rights, in person or by proxy, in respect of any class of voting shares of the bank beneficially owned by them that do not in aggregate exceed 20 per cent of the voting rights attached to that class of voting shares.

1991, c. 46, s. 392; 2001, c. 9, s. 98.

393. (1) Despite sections 374 and 377, a widely held bank or a widely held bank holding company may be a major shareholder of a bank with equity of five billion dollars or more and cease to control, within the meaning of paragraphs 3(1)(a) and (d), the bank if it has entered into an agreement with the Minister to do all things necessary to ensure that it is not a major shareholder of the bank on the expiration of the day specified in the agreement.

(2) If general market conditions so warrant and the Minister is satisfied that the bank or the bank holding company has used its best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which it must comply with that subsection.

1991, c. 46, s. 393; 2001, c. 9, s. 98.

393.1 (1) Despite sections 374 and 377, an eligible foreign institution, an eligible Canadian financial institution, other than a bank, or a widely held insurance holding company may be a major shareholder of a bank with equity of five billion dollars or more and cease to control, within the meaning of paragraph 3(1)(d), the bank if it has entered into an agreement with the Minister to do all things necessary to ensure that it is not a major shareholder of the bank on the expiration of the day specified in the agreement.

(2) If general market conditions so warrant and the Minister is satisfied that the institution or insurance holding company has used its best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which it must comply with that subsection.

2001, c. 9, s. 98.

394. (1) If a body corporate that is an eligible financial institution other than a bank controls, within the meaning of paragraph 3(1)(d), a bank with equity of five billion dollars or more and the body corporate subsequently ceases to be an eligible financial institution, the body corporate must do all things necessary to ensure that, on the day that is one year after the day it ceased to be an eligible financial institution,

(a) it does not control, within the meaning of paragraph 3(1)(d), the bank; and

(b) it is not a major shareholder of the bank.

(2) If general market conditions so warrant and the Minister is satisfied that the body corporate has used its best efforts to be in compliance with subsection (1) on the required day, the Minister may specify a later day as the day from and after which it must comply with that subsection.

1991, c. 46, s. 394; 2001, c. 9, s. 98.