Often when I am searching on the internet for Canadian companies that operate in the U.S. I will come across a publicly traded company with a Headquarters listed as an address near the border in Washington that I know to be a mailbox type service. Often, on further research I will discover a Canadian fax number or the corporate bio will state the company was originally founded in Canada. I find in amusing that companies will go to the trouble to establish a U.S. presence with a U.S. address, telephone number, etc yet will often retain a Canadian fax number.
These days may be coming to an end for many of these Canadian companies. The Sarbanes-Oxley Act passed some time ago. I believe it was in the wake of Enron and Worldcom. Sarbanes-Oxley has been phasing in over the last several years and apparently small-cap companies are starting to be effected by this. Sarbanes-Oxley has onerous reporting and auditing requirements in an attempt to prevent more corporate scandals. For small companies the cost of these additional requirements can be difficult to handle. The is also affecting Canadian companies that are publicly listed and is causing many to reconsider the benefits of U.S. listing compared to the increased reporting costs. I think we will see fewer Canadian companies choosing to access the U.S. money market through public listing and will probably see some smaller Canadian companies deregister from the U.S. Security and Exchange Commision.
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