S&P Dow Jones Indices is proposing changes to eligibility criteria that would let companies that aren’t domiciled in Canada remain part of the S&P/TSX Composite index.
The suggested modifications are in response to “observed trends” and market inquiries around its current policy, which requires companies to be legally based in Canada in order to be included in the TSX Composite and other stock gauges, according to a press release.
The group said the changes could “enhance the representativeness of S&P/TSX Indices” by broadening eligibility to a wider range of companies with “significant ties to Canada.”
This could include companies incorporated and listed — but not domiciled — in Canada, S&P DJI said. If adopted, the changes could be put into effect on Friday, June 20, after the market closes.
The consultation, which is currently seeking feedback until April 4, comes at a time when some Canadian companies are mulling whether to move south of the border.
Canadian trucking company TFI International Inc. considered moving its legal headquarters to the US before backing down on the decision after shareholder backlash.
Among these shareholders was public pension manager Caisse de Depot et Placement du Quebec, which has a mandate to boost the economic development of Quebec and encourages investments to remain in the province.
Stephanie Hughes, Bloomberg News
