There may be circumstances where an issuer elects to prepare and file a report in the absence of a formal technical report trigger pursuant to National Instrument – Standards of Disclosure for Mineral Projects (NI 43-101). These circumstances may include the filing of a report for a property that is not considered a material property under NI 43-101 or the filing of a report in response to stock exchange requirements. Any such report is referred to as “voluntary” and while a voluntary report is not prohibited under NI 43-101, any document purporting to be a technical report must still adhere to the requirements set out in NI 43-101, including being prepared in accordance with the prescribed form.
Strategic Benefits
There may be strategic benefits associated with filing a voluntary report, including, among others:
- Enhanced Transparency: Voluntarily filing a technical report can demonstrate a commitment to transparency and robust disclosure practices, potentially enhancing investor confidence.
- Improved Market Positioning: By providing detailed technical information, issuers can better position themselves in the market, showcasing the potential and breadth of their mineral properties.
- Proactive Regulatory Compliance: Proactively filing technical reports can help issuers stay ahead of regulatory requirements, ensuring compliance and reducing the risk of future scrutiny.
Qualified Person Consents
Unlike in connection with a traditional (mandatory) technical report filing, issuers are not required to file a consent of a qualified person(s) when voluntarily filing a technical report.
Instead, and while there is also no requirement to do so, Companion Policy 43-101CP recommends that issuers consider filing a cover letter or a modified consent of the qualified person(s) with the voluntary technical report explaining why the issuer is filing the report and indicating that it is not filing the report as a requirement under NI 43-101.
What Happens if the Property Subsequently Becomes Material or is Already Material and a Technical Report is Triggered?
For a voluntary report filed for a property that is not considered material to the issuer at the time of filing, it is important to note that the property may subsequently become material to the issuer. At that time, filing obligations under NI 43-101 will need to be reassessed. Accordingly, issuers must consider the significance of the property to their overall business and its impact on market value. The issuer’s disclosure record should also be considered to ensure the importance of the property conveyed in public disclosure is consistent with the treatment of the proposed technical report.
For a voluntary report filed for a property that is considered material to the issuer at the time of filing (i.e., if an exchange has requested the filing, rather than being triggered under NI 43-101), the issuer is reminded that they will likely subsequently trigger the required formal filing of that technical report under NI 43-101 on the occurrence of one of the prescribed scenarios.
In situations where a requirement for filing is triggered after a voluntary filing, provided the previously filed voluntary technical report remains current, the filing obligations will be satisfied by filing updated consents (or new consents) of the qualified person(s) who authored the report in the form prescribed by NI 43-101. Once the prescribed consents are filed, the technical report will then be treated as a current technical report for the purposes of NI 43-101.
Conclusion
Voluntary filings of technical reports under NI 43-101 can offer mining issuers strategic advantages, including enhanced transparency, improved market positioning, and proactive regulatory compliance. However, careful and ongoing consideration of materiality, involvement of a qualified person, and alignment with the issuer’s disclosure record are crucial to ensure regulatory compliance by the issuer in making such filings.
For more on National Instrument 43-101, find all our articles in this series here.
_____________________________
Cassels has distinguished itself in the vanguard of the mining industry, offering the largest and most experienced dedicated mining group of any major Canadian law firm. Led by Jen Hansen and Jennifer Traub, we are proud to be consistently ranked as Tier 1 for mining law by Chambers Canada. To learn more, visit cassels.com/mining.