Ontario’s Finance Ministry in early 2016 plans to draft legislation to remove a 30% limit on public and corporate pension funds in the province holding voting shares of an individual company.
The ministry announced the move in its fall economic statement to the Ontario Legislature on Nov. 26.
Anna Zalewski, an associate with law firm Osler, Hoskin & Harcourt, said, “based on the relatively strong wording contained in the fall economic statement,” the likelihood of the law’s passage is high.
If approved, Ontario would be the first province to remove the 30% holding limit on pension plans.
In April, the Canadian government announced it would hold public consultations with the country’s federal pension funds to remove the 30% limit. However, the consultations never were held prior to the federal election in October, said Ms. Zalewski.
“It’s not clear what will be done federally now as the new federal Liberal government has not made a similar promise,” she said.
The current holding limit does not apply to investment management subsidiaries of large provincial pension funds, such as the C$154.4 billion ($115.4 billion) Ontario Teachers’ Pension Plan and the C$72 billion Ontario Municipal Employees’ Retirement System, both of Toronto, which invest in real estate and natural resources.