CSA Announce Adoption of Semi-Annual Financial Reporting Pilot

Overview

On March 19, 2026, the Canadian Securities Administrators (the “CSA”) announced the adoption of a pilot project to allow eligible venture issuers to voluntarily transition from a quarterly to a semi-annual financial reporting framework (the “SAR Pilot”), subject to compliance with the terms and conditions in Coordinated Blanket Order 51‑933 – Exemptions to Permit Semi‑Annual Reporting for Certain Venture Issuers (the “Blanket Order”). The adoption of the SAR Pilot follows a 60-day public comment period that concluded on December 22, 2025.

Background

Prior to the introduction of the SAR Pilot, all Canadian reporting issuers were required to file interim financial statements and management’s discussion and analysis (“MD&A”) on a quarterly basis. While this approach was intended to ensure that investors received timely information, it imposed significant costs on smaller venture issuers, for whom the expense and effort of quarterly reporting often outweighed the benefits. The SAR Pilot responds to feedback from market participants and prior CSA consultations, which have consistently highlighted the need to reduce regulatory burden on venture issuers, while also recognizing concerns regarding the potential impact of less frequent disclosure.

What You Need to Know: Exemptions from Standard Reporting

Venture issuers that qualify for the SAR Pilot will not be required to file interim financial statements and the related MD&A for the first and third quarters, nor will they need to meet the related delivery and certification obligations under National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”) and National Instrument 52-109 – Certification of Disclosure in Issuers’ Annual and Interim Filings. Despite these exemptions, venture issuers must continue to file interim reports and MD&A for the six-month period, as well as their annual disclosures.

For the six-month filing, venture issuers are relieved from preparing a separate three-month statement of comprehensive income or comparative data for the prior year’s second quarter. The MD&A requirements are also simplified, as there is no longer a need to include eight-quarter summaries, fourth-quarter analysis or current-quarter discussions in an interim MD&A. Venture issuers may refer to their six-month interim period highlights as “Interim MD&A – Semi-Annual Highlights.”

Eligibility Criteria and Requirements

To participate in the SAR Pilot, issuers must satisfy all of the following conditions at the end of each three- and nine-month interim period (i.e., Q1 and Q3):

(a) the issuer has been a reporting issuer in at least one Canadian jurisdiction for a minimum of 12 months;

(b) the issuer must qualify as a “venture issuer” under NI 51-102;

(c) the issuer must have securities listed on the TSX Venture Exchange (the “TSXV”) or the Canadian Securities Exchange (the “CSE”);

(d) the issuer must have annual revenue not exceeding $10 million based on its most recently filed audited financial statements;

(e) the issuer must be current on all required periodic and timely disclosure filings;

(f) in the preceding 12 months, the issuer must not have:

• i. been subject to penalties, sanctions (other than administrative fees for late filings) or cease trade orders not revoked within 30 days, and
• ii. stopped relying on the exemptions in the Blanket Order; and

(g) the issuer must issue and file a news release on SEDAR+ announcing its participation in the SAR Pilot and indicating the initial interim period for which it will not file Q1 or Q3 interim financial statements and related MD&A.

Additionally, venture issuers participating in the SAR Pilot must cease relying on the Blanket Order if they change their financial year‑end or file a base shelf prospectus. The Blanket Order was updated following the 60‑day public comment period to clarify that, in addition to being prohibited from filing shelf prospectus supplements, participating issuers must also not distribute securities under an existing shelf prospectus supplement.

The exemptions provided under the SAR Pilot do not extend to disclosures required in short form prospectuses, information circulars, take‑over bid circulars or issuer bid circulars. If a venture issuer undertakes a short form prospectus distribution, it must discontinue reliance on the Blanket Order for the duration of the offering. Should a venture issuer opt out of the SAR Pilot or become ineligible, it should consider issuing a news release and reverting to quarterly reporting, including the required comparative information.

Next Steps

The SAR Pilot is now in effect in Ontario and across the remaining CSA jurisdictions. In Ontario, the local Blanket Order is subject to an 18‑month expiry due to statutory limits applicable to blanket orders under the Securities Act (Ontario). Following the expiry of the local Blanket Order, OSC Rule 51‑507 is expected to take effect (subject to ministerial approval) and is intended to facilitate the continued implementation of the multi‑year SAR Pilot in Ontario.

Going forward, the CSA will monitor issuer participation and the market impacts of the SAR Pilot to determine whether the semi‑annual reporting framework should be expanded to a broader range of issuers. In the meantime, issuers should continue to assess their eligibility and ensure appropriate disclosure in connection with their participation in the SAR Pilot.

If you have any questions with respect to the Blanket Order or the SAR Pilot, please contact Rebecca Cochrane ([email protected]), Neel Patel ([email protected]) or any other member of our Corporate Finance & Securities practice group. The authors gratefully acknowledge the assistance of Articling Student Jordan Stewart-Kuppek in the preparation of this update.

This update is intended as a summary only and should not be regarded or relied upon as advice to any specific client or regarding any specific situation.

If you would like further information regarding the contents discussed in this update or if you wish to discuss any aspect of this commentary, please feel free to contact us.