On June 14, 2023, the TSX Venture Exchange (“TSXV”) published a comprehensive report setting out four key commitments as part of its Venture Forward initiative aimed at strengthening the public venture landscape in Canada. The impetus for this initiative is to use innovative measures to increase efficiencies, accelerate transaction timelines and reduce costs for issuers.
On December 13, 2023, the TSXV fulfilled its first commitment by launching the TSXV Passport Listing Process (“TSXV Passport”), which provides advanced listing applicants with an expedited process to go public, bolster liquidity and raise capital, with accelerated review times and increased transparency. Issuers that qualify for TSXV Passport will continue to be subject to the same degree of due diligence as regular listing applicants.
Eligibility
To be eligible to apply under TSXV Passport, an applicant must meet specified criteria, which includes satisfying initial listing requirements without waivers, having a minimum of $500,000 in unallocated funds for working capital and financial resources and either:
- completing a minimum $10 million majority arm’s length equity financing regarding the listing application; or
- having, at minimum, a $50 million market capitalization at the time of listing, and
- having a minimum of $5 million in revenue in the most recent financial year, or
- completing a majority arm’s length equity financing of not less than 10% of the total number of issued and outstanding shares at the time of listing.
The TSXV website sets out additional eligibility criteria, including public distribution, and director and officer requirements. Applications involving a qualifying transaction, reverse takeover or change of business cannot be a related party transaction. Furthermore, an applicant can be an Excluded Resource Issuer but cannot be an Emerging Market Issuer, as such terms are defined in Policy 2.10 Listing of Emerging Market Issuers.
TSXV Passport Listing Process
Listing through TSXV Passport involves the following principal steps:
- Provide a pre-file letter that includes a comprehensive analysis demonstrating its satisfaction of the eligibility criteria referenced above. This is followed by a pre-filing meeting with the TSXV. Within three business days of this meeting, the TSXV will determine the applicant’s eligibility to proceed with a TSXV Passport application.
- An eligible applicant must submit a formal application with the same documents as other listing applications, along with a detailed submission letter requesting that the application be reviewed under TSXV Passport and a discussion of eligibility criteria. As reference, the TSXV website provides a sample submission letter. TSXV Passport applications must be “at an advanced stage of due diligence and file readiness” and are subject to standard listing fees.
- Within five to seven business days from receipt of all required items pursuant to TSXV Passport, the TSXV will: (i) provide an initial comment letter and schedule a meeting with the applicant to discuss its comments; and (ii) schedule status meetings with the applicant on a going-forward basis.
For further information or assistance with TSXV Passport, please contact the Capital Markets and Securities Group at Miller Thomson LLP.
