Regional Development Incentives Regulations, 1974 (C.R.C., c. 1388)

• 29 (1) The amount that the Minister shall, pursuant to section 10 of the Act, pay on account of a development incentive at the time he is satisfied that the facility has been brought into commercial production shall not exceed an amount equal to 80 per cent of the authorized development incentive as calculated at that time without taking into account

  • (a) the approved capital costs of any eligible assets not at that time in use in the operation; or

  • (b) jobs forecast for purposes of the authorization that, in the opinion of the Minister at that time, will not be created in the operation.

• (2) Subject to subsection (3), the Minister may,

  • (a) during the 30 months following the date on which a facility is brought into commercial production, in the case of a facility in respect of which a development incentive is based only on the approved capital costs, or

  • (b) during the 42 months following the date on which the facility is brought into commercial production, in the case of a facility in respect of which a development incentive is based in part on the number of jobs created in the operation,

  make an interim payment on account of the development incentive if such payment is greater than 25 per cent of the amount of the initial payment made pursuant to subsection (1).

• (3) The total of all payments made on account of a development incentive in respect of a facility prior to the expiration of

  • (a) 24 months from the date on which the facility is brought into commercial production, in the case of a facility in respect of which the development incentive is based only on the approved capital costs, or

  • (b) 36 months from the date on which the facility is brought into commercial production, in the case of a facility in respect of which the development incentive is based in part on the number of jobs created in the operation,

  shall not exceed 80 per cent of the estimated development incentive as calculated by the Minister at the time of the initial or interim payments.

• (4) The final payment on account of a development incentive shall take into account the approved capital cost and jobs created as determined by the Minister at the expiration of the period referred to in paragraph (3)(a) or (b), whichever is applicable.

30 The Minister shall not authorize a special development incentive with respect to a facility located in any region designated as a designated region in the Regional Development Incentives Designated Region Order, 1974 that is within the Province of Quebec, Ontario, Manitoba, Saskatchewan, Alberta or British Columbia.

Loan Guarantees

31 A loan guarantee may be authorized by the Minister in respect of the establishment of a commercial facility in the areas comprised by the regions designated as designated regions for the purposes of the Act by the Regional Development Incentives Designated Region Order, 1974 that provides commercial services of one or more of the following classes:

• (a) business offices;

• (b) warehousing and freight-handling facilities;

• (c) shopping centres;

• (d) convention facilities;

• (e) hotel accommodation;

• (f) recreational facilities; and

• (g) research facilities.

32 A loan guarantee shall not be authorized in respect of a commercial facility unless the total capital costs of the commercial facility will, in the opinion of the Minister, be at least $100,000.

• 33 (1) The maximum proportion of any loan the repayment of which and the payment of the interest on which may be guaranteed shall be 90 per cent and Her Majesty’s liability under any loan guarantee shall not exceed 90 per cent of the original principal amount of the loan.

• (2) The Minister shall not authorize a loan guarantee unless he is satisfied that the terms and conditions of the loan are in accordance with reasonable commercial practice with respect to

  • (a) the security provided for the loan; and

  • (b) the circumstances in which the borrower is deemed to be in default.

• 34 (1) It is a condition of any loan guarantee that the lender shall, semi-annually or at such shorter intervals as may be specified in the loan guarantee agreement, provide the Minister with a report showing

  • (a) the amount and date of any advances made under the loan;

  • (b) the amount and date of any payment received on account of principal or interest on the loan;

  • (c) any amount due on the last day of each month of the period covered by the report; and

  • (d) the amount and type of insurance carried on the facility or commercial facility.

• (2) It is a condition of any loan guarantee that the lender pay to the Receiver General, at the time he provides the Minister with a report pursuant to subsection (1), a guarantee fee of one per cent per annum calculated on the outstanding portion of the loan guaranteed by Her Majesty in right of Canada as of the last day of each month of the period covered by the report.

35 A loan guarantee agreement shall contain conditions respecting

• (a) the notification to be given to the Minister where the borrower is in default;

• (b) the terms and conditions under which the loan guarantee may be invoked;

• (c) the manner in which any assets of the borrower may be taken or seized by the lender;

• (d) the disposition or management of assets taken or seized by the lender;

• (e) the payments to the Receiver General to be made by the lender out of the disposition or management of assets taken or seized by the lender; and

• (f) such other terms and conditions as the Minister considers appropriate.