The Canadian Securities Administrators (the “CSA“) have officially launched the semi-annual reporting pilot (the “SAR Pilot”). This initiative, implemented through Coordinated Blanket Order 51-933 – Exemption to Permit Semi-Annual Reporting for Certain Venture Issuers (the “Blanket Order”), allows qualifying venture issuers to voluntarily elect to transition from quarterly to semi-annual financial reporting.

The initial SAR Pilot proposal published on October 23, 2025 received supportive feedback during the consultation period, with commenters highlighting how the exemption, with certain caveats, will help relieve the regulatory burden on smaller public companies. In adopting the SAR Pilot, the CSA looks to modernize and streamline continuous disclosure requirements to help spur activity in the Canadian capital markets.

 

Key Eligibility Criteria

The SAR Pilot is targeted at smaller public companies. To participate, a company must satisfy the following requirements:

• Exchange Listing: The company’s securities must be listed on the TSX Venture Exchange or the Canadian Securities Exchange.
• Revenue Cap: The company must have annual revenue not exceeding C$10 million in its most recently filed audited financial statements.
• Timely Disclosure: The company must have filed all periodic and timely disclosures required under applicable securities laws, or any order or undertaking by or to a securities regulatory authority.
• Compliance History: The company must have been a reporting issuer in at least one Canadian jurisdiction for at least 12 months and must be in good standing, meaning they were not subject to significant penalties, sanctions, or unrevoked cease-trade orders during the preceding 12-month period.

 

As noted in our previous article on the initial SAR Pilot proposal, the exemption does not apply to financial disclosure requirements in the context of capital-raising activities like prospectus offerings (including shelf prospectus filings and prospectus supplement offerings), take-over bid circulars or information circulars.

Additionally, a company cannot rely on the SAR Pilot if it changes its fiscal year end as it could result in an extended period of time without recent financial disclosure.

 

Notable Refinements in the Final Blanket Order

The final version of the Blanket Order includes several refinements based on feedback received during the comment period. One key clarification centres on eligibility: if an issuer’s revenue exceeds the C$10 million threshold or if they graduate to a non-venture exchange (like the TSX), they must immediately resume quarterly reporting in compliance with National Instrument 51-102 – Continuous Disclosure Obligations.

For companies that complete a reverse takeover transaction, the Blanket Order clarifies that a successor issuer cannot rely on the continuous disclosure history of the predecessor to participate in the SAR Pilot. To become eligible for the SAR Pilot, the successor issuer would need to make quarterly filings for 12 months following the completion of the transaction.

Furthermore, the CSA clarified that while Q1 and Q3 filings are exempt under the SAR Pilot, timely disclosure remains paramount. Companies must continue to file news releases and material change reports for any significant events.

 

How to Opt-In

Eligible companies can voluntarily opt into the SAR Pilot by filing a press release on SEDAR+ stating that the “news release is being filed pursuant to Coordinated Blanket Order 51-933 – Exemptions to Permit Semi-Annual Reporting for Certain Venture Issuers” and specifying the initial interim period for which the company will rely on the SAR Pilot exemption. This information is intended to provide transparency to the market and set investor expectations for the timing of future financial disclosure.

To further manage market expectations, a company may wish to include a clear statement about their semi-annual reporting periods in its relevant continuous disclosure (for example, the MD&A).

Should a company decide to cease participating in the SAR Pilot, it will once again become subject to all quarterly financial reporting requirements, including comparative financial information, as required under applicable securities laws.

The CSA recommends that a company deciding not to continue with the SAR Pilot issue a press release on SEDAR+ informing the market that it will revert to standard quarterly disclosure and indicate the next interim period for which filings will be made.

 

Who Should Consider the SAR Pilot?

While the cost savings alone will appeal to many venture issuers, the SAR Pilot is particularly well-suited for companies with long business development cycles and where quarterly fluctuations may not accurately reflect long-term value creation.

• Early-Stage Tech and Biotech: Companies with high R&D costs and minimal revenue can redirect the significant legal and accounting fees associated with Q1 and Q3 filings toward building their business.
• Seasonal Businesses: Companies that experience seasonal revenue fluctuations may find benefit in skipping quarterly updates to allow management to focus on growth at key points in the financial year rather than administrative overhead.
• Stable, Low-Revenue Companies: Smaller companies with predictable, modest revenue streams may find that the cost of four financial reviews per year outweighs the marginal benefit to their investor base.

 

The SAR Pilot and Maintaining Market Momentum

While the SAR Pilot’s cost savings are compelling, companies should consider whether a move to semi-annual reporting could lead to reduced visibility and potentially lower liquidity, as some institutional investors and analysts rely on frequent data points to maintain their models and coverage.

Companies should also weigh the administrative relief against the value of keeping the market and prospective investors engaged through consistent financial reporting. Where a company determines that the SAR Pilot is optimal, it should issue regular non-financial operational updates to continue to interact with investors and stakeholders.

The Pulse Law team is available to assist with all aspects of capital markets compliance, including evaluating whether to participate in the SAR Pilot. Please feel free to reach out with any questions about the Blanket Order and how these changes could affect your continuous disclosure strategy.