Business Development Incentives Regulations
made under Section 36 of the
Invest Nova Scotia Act
S.N.S. 2022, c. 37
O.I.C. 2015-298 (September 8, 2015, effective September 9, 2015), N.S. Reg. 321/2015
Table of Contents
Please note: this table of contents is provided for convenience of reference and does not form part of the regulations.
Click here to go to the text of the regulations.
Citation
Definitions
Affiliated bodies corporate
Annual business plan
Ineligibility for business development incentives
Business activities not eligible for business development incentives from Nova Scotia
Fund
Criteria required for business development incentives from Nova Scotia Fund
Terms and conditions of business development incentives from Nova Scotia Fund
Condition for business development incentives from strategic investment funds
Terms and conditions of business development incentives from strategic investment funds
Consents required for business development incentives from Nova Scotia Fund
Consents required for business development incentives from strategic investment funds
Consent required for purchase of equity securities
Corporation as an independent production fund
Power of Corporation on default
Applicants deemed consent to being contacted for review of Corporation
Citation
1 These regulations may be cited as the Business Development Incentives Regulations.
Definitions
2 In these regulations,
“Act” means the Nova Scotia Business Incorporated Act;
“affiliate” means an affiliate as determined under Section 2;
“annual portfolio lending cap” means the maximum amount of funds available to the
Corporation in each fiscal year for providing loans and loan guarantees to applicants;
“annual sector lending limits” means the maximum amount of funds available in
each fiscal year to each eligible sector of the economy of the Province as determined
by the Corporation under Section 4;
“applicant” means a person applying to the Corporation for a business development
incentive in accordance with the Act and these regulations;
“individual loan limits” means the maximum dollar value or the maximum
percentage of the total loan portfolio that is appropriate for any individual loan;
“loan guarantee limits” means the maximum dollar value or the maximum
percentage of the total loan portfolio that is appropriate for any loan guarantee;
“payroll rebate program” means a program funded through strategic investment
funds by which a portion of the payroll paid to employees by a business is returned
to the business based on a percentage of the total payroll of the business for the
employees;
“strategic investment funds” means funds other than the Nova Scotia Fund
maintained by the Corporation to fund certain forms of business development
incentives, including the payroll rebate program.
Affiliated bodies corporate
3 (1) For the purposes of these regulations, a body corporate is affiliated with another
body corporate if any of the following apply:
(a) one of them is the subsidiary of the other;
(b) both are subsidiaries of the same body corporate;
(c) each of them is controlled by the same person.
(2) Bodies corporate that are affiliated with the same body corporate at the same time
are deemed to be affiliated with each other.
(3) For the purposes of this Section,
(a) a body corporate is controlled by a person or by 2 or more bodies corporate if
all of the following apply:
(i) securities of the body corporate to which are attached more than 50% of
the votes that may be cast to elect directors of the body corporate are
held, other than by way of security only, by or for the benefit of that
person or by or for the benefit of those bodies corporate,
(ii) the votes attached to the securities referred to in subclause (i) are
sufficient, if exercised, to elect a majority of the directors of the body
corporate;
(b) a body corporate is the holding body corporate of another if that other body
corporate is its subsidiary; and
(c) a body corporate is a subsidiary of another body corporate if it is controlled by
any of the following:
(i) that other body corporate,
(ii) that other body corporate and 1 or more bodies corporate each of which
is controlled by that other body corporate,
(iii) 2 or more bodies corporate, each of which is controlled by that other
body corporate.
(4) A body corporate is deemed to be a subsidiary of another body corporate if it is a
subsidiary of that other body corporate’s subsidiary.
Annual business plan
4 The annual business plan submitted to the Minister under Section 31 of the Act must
include all of the following:
(a) all of the following as determined by the Corporation in respect of the Nova
Scotia Fund for the following fiscal year:
(i) the annual portfolio lending cap,
(ii) the annual sector lending limits,
(iii) the individual loan limits,
(iv) the loan guarantee limits,
(v) the interest rate policy;
(b) the maximum percentage of the total amount of the Nova Scotia Fund
available for business development incentives by way of working capital loans,
as determined in consultation with the Minister of Finance and Treasury
Board;
(c) policies and guidelines governing the payroll rebate program and any other
business development incentive funded through the strategic investment funds;
(d) any relevant information the Minister requires to assess the business plan in
accordance with the Act, these regulations and the outcomes agreement.
Ineligibility for business development incentives
5 The following business activities are not eligible for business development incentives:
(a) a commercial business or other activity that is carried out by a private,
exclusive or charitable club or organization;
(b) a business activity that is eligible for financial assistance or an economic
development incentive from any of the following:
(i) the Nova Scotia Fisheries and Aquaculture Loan Board,
(ii) the Nova Scotia Farm Loan Board,
(iii) a Provincial lending authority determined by the Corporation.
Business activities not eligible for business development incentives from Nova Scotia Fund
6 A business activity involving any of the following is not eligible for business development
incentives from the Nova Scotia Fund:
(a) supplying residential or rental accommodations;
(b) supplying business premises to non-related persons;
(c) lending money or other activities of a finance company, loan company or trust
company;
(d) providing insurance within the meaning of the Insurance Act;
(e) trading in or development of real estate for purposes other than as set out in the
Act and these regulations;
(f) construction by a person engaged in the construction industry;
(g) selling products at retail or wholesale.
Criteria required for business development incentives from Nova Scotia Fund
7 (1) An applicant must meet all of the following criteria to be eligible for a business
development incentive from the Nova Scotia Fund:
(a) they have fulfilled credit assessment requirements to justify economic viability,
including an assessment of the competence of management, probable market
demand and competition, earning prospects, the owners’ equity, the security
available with respect to any loan or loan guarantee and any potential
environmental impacts;
(b) they have obtained all approvals, permits or licences that are required from any
regulatory agency that has lawful authority to regulate the activities of the
business;
(c) they have or propose to have a minimum equity investment in the business of
at least 20%, in a manner and form determined by the Corporation, unless in
the circumstances of the particular case the Corporation determines otherwise.
(2) The Corporation must not provide a business development incentive from the Nova
Scotia Fund unless all of the following conditions are met:
(a) providing the business development incentive to the applicant represents a net
economic benefit to the Province and will be in the best interests of the
Province and of the community in which the business is or is to be located;
(b) providing the business development incentive to the applicant will not unfairly
impact on any other business already operating within the Province;
(c) there is no acceptable competitive alternative by which a loan or loan guarantee
could be obtained by the applicant from another source on reasonable terms
and conditions;
(d) the Corporation has considered the matters set out in its annual business plan.
(3) Business development incentives from the Nova Scotia Fund must not be provided
in the form of non-repayable contributions.
Terms and conditions of business development incentives from Nova Scotia Fund
8 (1) Subject to any requirement for consent under Section 11, the Corporation may
provide a business development incentive from the Nova Scotia Fund on any terms
and conditions that it considers appropriate, including any of the following:
(a) the amount and interest rate of the incentive;
(b) the security to be provided by an applicant;
(c) the fees to be paid by an applicant;
(d) the covenants to be entered into by an applicant;
(e) the terms of repayment of the incentive, after appropriate consideration is given
by the Corporation to the economic life of any asset being financed by the
incentive;
(f) the form and content of any documents to be signed or provided by an
applicant.
(2) Subject to any requirement for consent under Section 11, the Corporation may
amend the terms and conditions of a business development incentive from the Nova
Scotia fund at any time.
Condition for business development incentives from strategic investment funds
9 The Corporation must consider the policies and guidelines established for business
development incentives from the strategic investment funds before providing a business
development incentive from the strategic investment funds.
Terms and conditions of business development incentives from strategic investment funds
10 (1) Subject to any requirement for consent under Section 12, the Corporation may
provide a business development incentive from the strategic investment funds on any
terms and conditions that it considers appropriate, including any of the following:
(a) the amount of the incentive;
(b) the covenants to be entered into by an applicant;
(c) the form and content of any documents to be signed or provided by an
applicant.
(2) Subject to any requirement for consent under Section 12, the Corporation may
amend the terms and conditions of a business development incentive from the
strategic investment funds at any time.
Consents required for business development incentives from Nova Scotia Fund
11 A decision of the Corporation approving or amending a business development incentive
from the Nova Scotia Fund that results in the total amount owed by the applicant for the
incentive and for any other business development incentive from the Nova Scotia Fund
owed by the applicant and any affiliate of the applicant exceeding the amount set out in the
following table requires the corresponding consent:
Decision
|
Amount exceeded
|
Consent required
|
• approval of any one business
development incentive from the Nova
Scotia Fund
• amendment of any terms and
conditions governing a business
development incentive from the Nova
Scotia Fund
|
$5,000,000
|
Minister
|
• approval of any one business
development incentive from the Nova
Scotia Fund
• amendment of any terms and
conditions governing a business
development incentive from the Nova
Scotia Fund
|
$10,000,000
|
Minister and
Governor in
Council
|
Consents required for business development incentives from strategic investment funds
12 (1) A decision of the Corporation approving or amending a business development
incentive from the strategic investment funds that results in the total amount for
which the applicant is eligible for the incentive and any other business development
incentive from the strategic investment funds for which the applicant is eligible and
for which any affiliate of the applicant is eligible exceeding the amount set out in the
following table requires the corresponding consent:
Decision
|
Amount exceeded
|
Consent required
|
• approval of any one business
development incentive from the
strategic investment funds
• amendment of any terms and
conditions governing a business
development incentive from the
strategic investment funds
|
$5,000,000
|
Minister
|
• approval of any one business
development incentive from the
strategic investment funds
• amendment of any terms and
conditions governing a business
development incentive from the
strategic investment funds
|
$10,000,000
|
Minister and
Governor in
Council
|
(2) The consent of the Minister and the Governor in Council is required for a business
development incentive from the strategic investment funds that is part of the payroll
rebate program if the terms and conditions of the incentive provide for a
commencement date that is earlier than the date the incentive is approved by the
Corporation.
Consent required for purchase of equity securities
13 The consent of the Minister and of the Governor in Council is required for any decision of
the Corporation to purchase or acquire additional common or preferred shares or other
equity securities, including venture capital investments, under clause 16(1A)(b) of the Act.
Corporation as an independent production fund
14 Nothing in these regulations is intended to restrict the ability of the Corporation to be or
become certified as an independent production fund under the Broadcasting Distribution
Regulations (Canada) and, in connection with such certification, make investments as
permitted under those regulations as an independent production fund.
Power of Corporation on default
15 Upon default in the obligations owed to the Corporation by any person receiving a
business development incentive or otherwise obligated to the Corporation, the Corporation
may take steps to enforce the performance of the obligations and to realize on any security
held by the Corporation in accordance with policies and procedures adopted by the
Corporation.
Applicants deemed consent to being contacted for review of Corporation
16 Applicants are deemed to consent to being contacted by any representative of the
Corporation, the Department or an independent person appointed by the Corporation in
accordance with Section 32 of the Act in respect of any review being conducted under the
Act.
The following regulations are not
yet in force and are not included in the current consolidation: