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Fairness for Canadian Growth Companies

March 25, 2020

Dear Minister Morneau:

RE: Fairness for Canadian Growth Companies

In response to the COVID-19 crisis, the government of Canada has introduced a COVID-19 economic plan in support of Canadian workers and businesses. This is a necessary and timely initiative, and we applaud the government for taking decisive action.

TMX has taken the government's lead in helping Canadian businesses endure this crisis by introducing temporary relief measures for our listed issuers during the COVID-19 pandemic. Announced Monday, these measures are designed to lessen the administrative burden on public companies and provide greater flexibility in dealing with market volatility.

We recognize the immense challenges in managing this rapidly evolving situation and appreciate that the government is acting in good faith and with immediacy to support Canadian workers and businesses in need. However, we believe one element of the government's COVID-19 support plan will lead to unintended negative consequences for publicly traded growth companies and their employees.

While a much-needed wage subsidy has been made available to help small businesses retain employees, that subsidy applies only to private corporations, non-profit organizations and charities -- to the direct exclusion of growth-stage public companies and the people who work in them.

TMX Group exchanges Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV) are home to hundreds of innovative, home-grown companies that employ thousands of Canadians and generate millions of dollars in economic activity for Canada. Roughly two-thirds of our more than 3,200 issuers are small and medium-sized enterprises, or SMEs. And yet, during these crucial early stages in their growth cycle, these public companies are not eligible for the same levels of government support offered to privately held companies. This is, unfortunately, a consistent problem we have brought up in the past during "normal" market conditions, and now with businesses facing an unprecedented and still unfolding challenge in the COVID-19 pandemic, the lack of fairness in defining what constitutes a small and emerging business has become even more pronounced.

As you know, TMX has been actively advocating for equal access to support measures for public growth companies for some time now, most notably with our #Fairness4Growth campaign. However, our core concerns remain unaddressed: the government's attempts to help small businesses through this crisis have put Canada's public growth companies at a distinct disadvantage, to the detriment of these companies, their employees, and the investing public.

We therefore urge the Canadian government to consider important amendments to its COVID-19 response package to provide all Canadian SMEs with the support they need. Full access for all of these companies to the new wage subsidy and any subsequent support measures are essential to the short-term efficacy of this important initiative and to the long-term success of the Canadian economy.


John McKenzie
CFO and Interim CEO
TMX Group Limited