Financial Administration Act (R.S.C., 1985, c. F-11)

PART III.2Financial Transactions Related to Asset Management

Marginal note:Definitions

42.2 The following definitions apply in this Part.

fiscal agent

fiscal agent means a fiscal agent appointed under this Part and includes the Bank of Canada. (agent financier)

registrar

registrar means a registrar appointed under this Part and includes the Bank of Canada. (agent comptable)

Marginal note:Lending of funds

• 42.3 (1) The Minister may, for the sound and efficient management of the Consolidated Revenue Fund, lend money by way of an auction on any terms and conditions that the Minister considers appropriate.

• Marginal note:Limit

  (2) However, the Minister is not to make a loan that exceeds the surplus of the part of the Consolidated Revenue Fund that is on deposit with the Bank of Canada at the time of the making of the loan.

• Marginal note:Determination

  (3) For the purposes of subsection (2), the amount of the surplus is determined by the Bank of Canada.

• Marginal note:Part of Consolidated Revenue Fund

  (4) Any loans made under subsection (1) may only be paid out of the part of the Consolidated Revenue Fund that is on deposit with the Bank of Canada.

• Marginal note:Powers related to loans

  (5) Despite section 42.5, the Minister may enter into any contract or agreement related to the loans and do any other thing relating to the loans that the Minister considers appropriate.

Marginal note:Auctions

• 42.4 (1) If the Minister lends money by way of an auction, the Minister may establish rules governing the conduct of the auction, including rules relating to any of the following:

  • (a) the eligibility of persons to participate in the auction;

  • (b) the provision to the Minister by participants of any information that the Minister considers relevant;

  • (c) the form of bids;

  • (d) the maximum amount that a participant may bid.

• Marginal note:Rules not statutory instruments

  (2) Rules governing the conduct of an auction are not statutory instruments as defined in the Statutory Instruments Act.

Marginal note:Management of risks

42.5 The Governor in Council may authorize the Minister, subject to any terms and conditions that the Governor in Council may specify, to enter into any contract or agreement of a financial nature, including options, derivatives, swaps and forwards, on any terms and conditions that the Minister considers necessary for the management of risks related to the financial position of the Government of Canada.

Marginal note:Registrars and fiscal agents

42.6 The Minister may

• (a) appoint one or more registrars or fiscal agents to perform any services that the Minister may specify in respect of financial transactions entered into under this Part; and

• (b) fix the remuneration or compensation of any registrar or fiscal agent appointed under this section.

Marginal note:Payment of related expenses

42.7 With the authorization of the Governor in Council, there may be paid out of the Consolidated Revenue Fund

• (a) the remuneration and compensation of registrars and fiscal agents appointed under section 42.6;

• (b) all costs, expenses and charges incurred in the management of financial transactions referred to in this Part, including the negotiation, entering into and execution of those transactions;

• (c) all money required to be paid under contracts and agreements entered into under subsection 42.3(5) or section 42.5;

• (d) all money required to be paid under contracts and agreements entered into under this Act before the coming into force of this Part that could also have been entered into under this Part if this Part had been in force when these contracts and agreements were entered into; and

• (e) all money that the Minister considers appropriate to pay in the exercise of his or her power to do any other thing relating to the lending of money under subsection 42.3(5).

Marginal note:Delegation

42.8 The Minister may delegate to any officer of the Department of Finance any of the Minister’s powers, duties or functions under this Part, except the power to delegate under this section.

PART IVPublic Debt

Marginal note:Borrowing of money

• 43 (1) Notwithstanding any statement in any other Act of Parliament to the effect that this Act or any portion or provision of it does not apply, no money shall be borrowed by or on behalf of Her Majesty in right of Canada except as provided by or under

  • (a) this Act;

  • (b) any other Act of Parliament that expressly authorizes the borrowing of money; or

  • (c) any other Act of Parliament that provides for the borrowing of money from Her Majesty in right of Canada or of a province.

• Marginal note:Issuing of securities

  (2) No securities shall be issued by or on behalf of Her Majesty in right of Canada without the authority of Parliament.

43.1 [Repealed, 2016, c. 7, s. 182]

Marginal note:Raising of money

• 44 (1) When by this Act or any other Act of Parliament authority is given to raise money by Her Majesty, the Governor in Council may, subject to the Act authorizing the raising of the money, authorize the Minister to borrow the money by any means that the Minister considers appropriate.

• Marginal note:Maximum

  (2) The aggregate principal amount of money borrowed by the Minister under this section in any fiscal year may not exceed the amount that is specified by order of the Governor in Council for that fiscal year.

• Marginal note:Maximum — exception

  (2.1) Any money borrowed under section 47 is not to be taken into account for the purpose of calculating the aggregate principal amount of money borrowed by the Minister under this section in any fiscal year.

• Marginal note:Powers of Minister

  (3) Subject to any terms and conditions that the Governor in Council may specify, the Minister may enter into any contract or agreement, issue securities and do any other thing relating to the borrowing of money that the Minister considers appropriate.

• Marginal note:Non-application of regulations and directions

  (3.1) Regulations and directions made under subsection 41(1) do not apply in respect of contracts entered into under subsection (3).

• Marginal note:Transitional

  (4) Subsection (3) applies with respect to anything done in relation to borrowings under this section, as it read immediately before the coming into force of this subsection, as though the borrowing were done under subsection (1).

Marginal note:Auctions

• 45 (1) If the Minister borrows money by way of an auction, the Minister may establish rules governing the conduct of the auction, including rules relating to

  • (a) the eligibility of persons to participate in the auction;

  • (b) the provision to the Minister by participants of any information that the Minister considers relevant, including information respecting holdings of securities and transactions in securities;

  • (c) the form of bids;

  • (d) the maximum amount that may be bid for by a participant; and

  • (e) the certification and verification of bids.

• Marginal note:Rules not statutory instruments

  (2) Rules governing the conduct of an auction are not statutory instruments as defined in the Statutory Instruments Act.

Marginal note:Contracts and agreements

45.1 The Governor in Council may authorize the Minister, subject to any terms and conditions that the Governor in Council may specify, to enter into any contract or agreement of a financial nature, including options, derivatives, swaps and forwards, on such terms and conditions as the Minister considers necessary.

Marginal note:Powers — management of assets and liabilities

46 The Minister may, on any terms and conditions the Minister considers appropriate, do any of the following if the Minister considers it appropriate for the sound and efficient management of the assets and liabilities of Canada, including contingent liabilities:

• (a) purchase or acquire securities of Canada or any other securities, including purchasing or acquiring them on their issuance, and hold, lend or sell securities of Canada or any other securities; and

• (b) create a charge on, or right or interest in, securities of Canada or any other securities held by the Minister.

Marginal note:Authority to borrow money

46.1 In any fiscal year, the Governor in Council may by order authorize the Minister to borrow money for

• (a) the payment of any amount that is required to be paid in that fiscal year in respect of any money borrowed under the authority of this Act or any other Act of Parliament;

• (b) the extinguishment or reduction of any liability of Canada, if the Minister is of the opinion that the liability should be extinguished or reduced; or

• (c) the payment, by Her Majesty, of any amount in extraordinary circumstances, including in the event of a natural disaster or to promote the stability or maintain the efficiency of the financial system in Canada, if the Minister is of the opinion that the borrowing of money is necessary in those circumstances.

Marginal note:Exception

47 During the period beginning on the day on which this section comes into force and ending on September 30, 2020, the Minister may borrow money for

• (a) the payment of any amount that is required to be paid in that period in respect of any money borrowed under the authority of this Act or any other Act of Parliament; or

• (b) the payment, by Her Majesty, of any amount in extraordinary circumstances, including in the event of a natural disaster or to promote the stability or maintain the efficiency of the financial system in Canada, if the Minister is of the opinion that the borrowing of money is necessary in those circumstances.

Marginal note:Currency of borrowings

• 48 (1) Any amounts raised by way of loan under the authority of this Act or any other Act of Parliament in the currency or currencies of any country or countries may be repaid in the currency or currencies of any country or countries and securities issued under the authority of this Act or any other Act of Parliament in the currency or currencies of any country or countries may be made payable in the currency or currencies of any country or countries.

• Marginal note:Calculation of amount in foreign currency

  (2) Where an Act of Parliament, whether enacted before or after the coming into force of this subsection, authorizes

  • (a) the raising of a specific or maximum number of dollars by way of loan or the issue of securities, or

  • (b) the guarantee of the payment of a liability or obligation for a specific or maximum number of dollars,

  the authorized transaction may be undertaken, in whole or in part, in the currency of a country other than Canada, and for that purpose the specific or maximum number of dollars shall be construed as an equivalent amount in the currency of the other country, calculated at the daily average rate of exchange between the Canadian dollar and the currency concerned quoted by the Bank of Canada on the day immediately preceding the day on which the money is borrowed, the proceeds from the issue of securities are received or the guarantee is given, as the case may be, or at any other rate of exchange in use between those currencies that the Minister considers appropriate.

• Marginal note:Calculation where limitation

  (3) For the purpose of any limitation in respect of an amount

  • (a) that may be borrowed,

  • (b) for which securities may be issued, or

  • (c) the payment of which may be guaranteed under this Act or any other Act of Parliament,

  the principal amount borrowed or authorized to be borrowed, the principal amount of any securities previously issued or authorized to be issued or the amount guaranteed or authorized to be guaranteed, as the case may be, payable in a currency of any country other than Canada, shall be deemed to be the Canadian dollar equivalent of the value thereof, as calculated under subsection (2), regardless of any premium or discount at which the securities were sold and regardless of any premium that may be payable on early redemption.

Marginal note:Report on debt management

• 49 (1) After the Public Accounts are tabled in the House of Commons, the Minister shall cause to be tabled in each House of Parliament, within the first 30 days on which that House is sitting after the Public Accounts are tabled in the House of Commons, a report on the activities of the Minister in relation to the following:

  • (a) the money borrowed in the fiscal year to which the Public Accounts relate;

  • (a.1) the money that is borrowed under an order made under paragraph 46.1(c) of the Financial Administration Act, other than that borrowed under such an order made during the period beginning on March 23, 2021 and ending on May 6, 2021, and that is due at the end of the fiscal year to which the Public Accounts relate; and

  • (a.2) [Repealed, 2021, c. 7, s. 19]

  • (b) the management of the public debt in the fiscal year to which the Public Accounts relate.

• Marginal note:Report on Minister’s plans

  (2) The Minister shall cause to be tabled in each House of Parliament for every fiscal year, not later than the 30th day on which that House is sitting after the start of the fiscal year to which the report relates, a report on the Minister’s plans in relation to the following:

  • (a) the money to be borrowed in that fiscal year and the purposes for which the moneys will be borrowed; and

  • (b) the management of the public debt in that fiscal year.