CSA: Ideas wanted to overhaul NI 43-101 rules

In response to a disturbing mining industry trend, the Canadian Securities Administrators launched a project in January to revise National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101). The British Columbia Securities Commission is leading the project with participation from other CSA jurisdictions.

Greg Gosson, a geologist with AMEC Americas Ltd., told attendees at the 2009 Prospectors and Developers Association of Canada convention that the CSA surveyed mining companies last year and found that 16 percent of survey respondents had NI 43-101 reports that were not current, along with other areas of concern. CSA initiated the project in response to the survey results and a number of industry and regulatory concerns that have developed since it implemented NI 43-101 requirements in 2001.

Gosson said a particular difficulty centers on the definition of "current" when it comes to NI 43-101 reports.

"To be current, a report does not omit any material or scientific information about a mine project as of the date of filing," he said. "It also must be accurate, and it must match what the company is telling investors."

Some other potential areas for consideration include:

Reducing the regulatory burden of consents of qualified persons;

Reducing the qualified person's liability and responsibility for issuer disclosure;

Reassessing technical report triggers to make sure we have the right ones;

Creating broader and more flexible rules for disclosing previous resource and reserve estimates;

Fixing a few perceived disclosure irregularities, such as economic analyses of exploration targets and historical estimates and first-time disclosure of resources, reserves and preliminary assessments on Web sites and third-party reports;

Introducing a separate form of technical report for advanced mineral projects; and

Updating accepted foreign professional associations.

CSA aims to revise the NI 43-101 standards and is seeking suggestions and recommendations for improvements from the mining industry. A three-month consultation period on the rules ends in April.

Email improvement recommendations or suggestions to [email protected].