Ontario Securities Commission Bulletin
Issue 43/41 - October 08, 2020
Ont. Sec. Bull. Issue 43/41
• OSC Staff Notice 11-737 (Revised) -- Securities Advisory Committee -- Vacancies
• Russell Investments Canada Limited
• Purpose Investments Inc. and Purpose Structured Equity Yield Portfoli•
• Summit Industrial Income REIT et al.
• SEI Investments Canada Company and Richardson GMP Limited
• I.G. Investment Management, Ltd.
• I.G. Investment Management, Ltd.
• Hamilton Capital Partners Inc. and Hamilton Canadian Bank 1.25x Leverage ETF
• Temporary, Permanent & Rescinding Issuer Cease Trading Orders
• Temporary, Permanent & Rescinding Management Cease Trading Orders
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Notice of Correction -- CSA Notice of Amendments to National Instrument 81-105 Mutual Fund Sales Practices and Related Consequential Amendments Prohibition of Mutual Fund Trailing Commissions Where No Suitability Determination Was Required -- Annex F
The following Annex F was omitted from the original publication of CSA Notice of Amendments to National Instrument 81-105 Mutual Fund Sales Practices and Related Consequential Amendments Prohibition of Mutual Fund Trailing Commissions Where No Suitability Determination Was Required, published at (2020) 43 OSCB 7299, September 17, 2020.
In Ontario, the Amendments, as well as other required materials, will be delivered to the Minister of Finance on or about October 8, 2020. The Minister may approve or reject these Amendments or return them for further consideration. If the Minister approves the Amendments or does not take any further action, the Amendments to 81-101 Mutual Fund Prospectus Disclosure and National Instrument 41-101 General Prospectus Requirements will come into force on December 31, 2020, and the Amendments to National Instrument 81-105 Mutual Fund Sales Practices will come into force on June 1, 2022, with the exception of the "suitability determination" definition in section 1.1 of National Instrument 81-105 Mutual Fund Sales Practices, which will come into force on December 31, 2020.
OSC Staff Notice 11-737 (Revised) -- Securities Advisory Committee -- Vacancies
The Securities Advisory Committee ("SAC") is a committee of industry experts established by the Commission to advise it and its staff on a variety of matters including policy initiatives and capital markets trends. The Commission seeks four prospective candidates to serve on SAC beginning in January 2021 for a three-year term ending December 2023. There is a one-third turnover of SAC membership each calendar year.
SAC members generally meet every month and provide advice on a variety of matters, including legal and regulatory initiatives, as well as market implications of Commission rules, policies, operations, and administration. SAC members are also invited to provide their perspectives on emerging trends in the marketplace. Those who make a commitment to serve on SAC must be in a position to devote the time necessary to attend meetings and be an active participant at those meetings.
SAC members are expected to have excellent technical abilities and a strong interest in the development of securities regulatory policy. This includes having in-depth knowledge of the legislation, rules and policies for which the Commission is responsible, as well as a significant practice and experience in the securities field. Expertise in an area of special interest to the Commission at the time of an appointment will also be a factor in selection. Diversification of membership on SAC continues to be a Commission priority in order to promote a broad perspective on the development of securities regulatory policy. In addition to candidates engaged in private practice, we continue to welcome the submission of applications from in-house counsel practicing in the securities area at an exchange, institutional investor or dealer.
Qualified individuals who have the support of their firms/employers for the commitment required to effectively participate on SAC, are invited to apply in writing for membership on SAC to the General Counsel's Office of the Commission, indicating areas of practice and relevant experience. Prospective candidates are encouraged to review OSC Policy 11-601 for further information about SAC.
SAC members whose terms continue past December 2020 are:
•
Kathryn J. Daniels
Canadian Pension Plan Investment Board
•
Linda Fuerst
Norton Rose Fulbright Canada LLP
•
Desmond Lee
Osler, Hoskin & Harcourt LLP
•
Jennifer F. Longhurst
Davies Ward Phillips and Vineberg LLP
•
Julie Mansi
Borden Ladner Gervais LLP
•
Leila Rafi
McMillan LLP
•
Rima Ramchandani
Torys LLP
•
Ora Wexler
Dentons Canada LLP
The Commission wishes to thank the following members whose terms will expire at the end of December 2020:
•
Deanna Dobrowsky
Toronto Stock Exchange
•
Margaret Gunawan
BlackRock Asset Management
•
Barbara Hendrickson
Bax Toronto Stock Exchange Securities Law
•
Blair Wiley
Wealthsimple
The Commission is very grateful to outgoing members for their able assistance and valuable input.
Applications for SAC membership will be considered if received on or before November 6, 2020. Applications should be submitted by email to:
James SinclairGeneral CounselOntario Securities Commission20 Queen Street West, 22nd FloorToronto, Ontario, M5H 3S8Tel: (416) 263-3870jsinclair@osc.gov.on.ca
FILE NO.: 2020-34
PROCEEDING TYPE: Hearing and Review
HEARING DATE AND TIME: October 9, 2020 at 3:30 p.m.
LOCATION: By videoconference
The purpose of this proceeding is to consider the Application dated September 30, 2020 made by the party named above to review a decision of the Investment Industry Regulatory Organization of Canada dated September 24, 2020.
The hearing set for the date and time indicated above is the first attendance in this proceeding, as described in subsection 6(1) of the Commission's Practice Guideline.
Any party to the proceeding may be represented by a representative at the hearing.
IF A PARTY DOES NOT ATTEND, THE HEARING MAY PROCEED IN THE PARTY'S ABSENCE AND THE PARTY WILL NOT BE ENTITLED TO ANY FURTHER NOTICE IN THE PROCEEDING.
This Notice of Hearing is also available in French on request of a party. Participation may be in either French or English. Participants must notify the Secretary's Office in writing as soon as possible if the participant is requesting a proceeding be conducted wholly or partly in French.
L'avis d'audience est disponible en français sur demande d'une partie, que la participation à l'audience peut se faire en français ou en anglais et que les participants doivent aviser le Bureau du secrétaire par écrit dès que possible si le participant demande qu'une instance soit tenue entièrement ou partiellement en français.
Dated at Toronto this 6th day of October, 2020.
For more information
Please visit www.osc.gov.on.ca or contact the Registrar at registrar@osc.gov.on.ca.
FOR IMMEDIATE RELEASE
October 1, 2020
TORONTO -- Take notice that an attendance in the above-named matter is scheduled to be heard on October 1, 2020 at 1:00 p.m.
For Media Inquiries:
For General Inquiries:
FOR IMMEDIATE RELEASE
October 1, 2020
TORONTO -- The Commission issued an Order in the above named matter.
A copy of the Order dated October 1, 2020 is available at www.osc.gov.on.ca.
For Media Inquiries:
For General Inquiries:
FOR IMMEDIATE RELEASE
October 1, 2020
TORONTO -- The Commission issued an Order in the above named matter.
A copy of the Order dated October 1, 2020 is available at www.osc.gov.on.ca.
For Media Inquiries:
For General Inquiries:
FOR IMMEDIATE RELEASE
October 2, 2020
TORONTO -- Take notice that an attendance in the above named matter is scheduled for October 9, 2020 at 9:00 a.m.
For Media Inquiries:
For General Inquiries:
FOR IMMEDIATE RELEASE
October 6, 2020
TORONTO -- The Office of the Secretary issued a Notice of Hearing to consider the Application dated September 30, 2020 made by the party named above to review a decision of the Investment Industry Regulatory Organization of Canada dated September 24, 2020.
The hearing will be held on October 9, 2020 at 3:30 p.m.
A copy of the Notice of Hearing dated October 6, 2020 and the Application dated September 30, 2020 are available at www.osc.gov.on.ca.
For Media Inquiries:
For General Inquiries:
Russell Investments Canada Limited
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted to combine the simplified prospectus of an alternative mutual fund with the simplified prospectus of a conventional mutual fund.
National Instrument 81-101 Mutual Fund Prospectus Disclosure, ss. 5.1(4) and 6.1.
September 29, 2020
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of Russell Investments Yield Opportunities Pool (the Existing Alternative Fund) and any alternative mutual fund established in the future and managed by the Filer or an affiliate of the Filer (the Future Alternative Funds, and together with the Existing Alternative Fund, the Alternative Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that grants relief to the Alternative Funds from the requirement in subsection 5.1(4) of National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) which states that a simplified prospectus for an alternative mutual fund must not be consolidated with a simplified prospectus of another mutual fund if the other mutual fund is not an alternative mutual fund (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Canadian Jurisdictions).
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and National Instrument 81-102 Investment Funds (NI 81-102).
This decision is based on the following facts represented by the Filer:
1. The Filer is a corporation incorporated under the laws of the Province of Ontario with its head office located in Toronto, Ontario.
2. The Filer currently is registered under the securities legislation in:
(a) the Canadian Jurisdictions in the categories of investment fund manager, portfolio manager and exempt market dealer;
(b) Ontario as a commodity trading manager and as a mutual fund dealer exempt from membership in the Mutual Fund Dealers Association of Canada; and
(c) Manitoba as an advisor (commodities).
3. The Filer, or an affiliate of the Filer, is, or will be, the investment fund manager of each Alternative Fund.
4. The Filer is not in default of the securities legislation in any of the Canadian Jurisdictions.
5. Each Alternative Fund is, or will be, established under the laws of Ontario or Canada as a mutual fund that is a trust or a class of shares of a mutual fund corporation and is, or will be, a reporting issuer in one or more of the Canadian Jurisdictions.
6. The Existing Alternative Fund is not in default of the securities legislation in any of the Canadian Jurisdictions.
7. The securities of each Alternative Fund are, or will be, qualified for distribution in one or more of the Canadian Jurisdictions using a simplified prospectus, annual information form, fund facts documents and/or ETF facts documents, prepared and filed in accordance with the securities legislation of such Canadian Jurisdictions. Each Alternative Fund is, or will be, subject to the requirements of NI 81-101 and NI 81-102.
8. If an Alternative Fund offers both securities which are listed on a stock exchange and securities which are not listed on a stock exchange, the Alternative Fund has received permission to distribute such securities using a simplified prospectus rather than a long form prospectus pursuant to National Instrument 41-101 General Prospectus Requirements (NI 41-101).
9. The Filer wishes to combine the simplified prospectus of the Alternative Funds with the simplified prospectus of mutual funds existing today or created in the future (i) that are reporting issuers to which NI 81-101 and NI 81-102 apply, (ii) that are not alternative mutual funds, and (iii) for which the Filer, or an affiliate of the Filer, acts as the investment fund manager (Conventional Funds) in order to reduce renewal, printing and related costs. Offering the Alternative Funds using the same simplified prospectus and annual information form as the Conventional Funds would facilitate the distribution of the Alternative Funds in the Canadian Jurisdictions under the same prospectus disclosure and enable the Filer to streamline disclosure across the Filer's fund platform.
10. Even though the Alternative Funds are, or will be, alternative mutual funds, they share, or will share, many common operational and administrative features with the Conventional Funds and combining them in the same simplified prospectus will allow investors to more easily compare the features of the Alternative Funds and the Conventional Funds.
11. Investors will continue to receive the fund facts document(s) or ETF facts document(s), as applicable, when purchasing securities of the Alternative Funds or Conventional Funds as required by applicable securities legislation. The form and content of the fund facts document(s) and ETF facts document(s) of the Alternative Funds and Conventional Funds will not change as a result of the Exemption Sought. The simplified prospectus and/or annual information form of the Alternative Funds and Conventional Funds will continue to be provided to investors, upon request, as required by applicable securities legislation.
12. NI 41-101 does not contain a provision equivalent to subsection 5.1(4) of NI 81-101. Accordingly, an investment fund manager that manages exchange-traded funds (ETFs) is permitted to consolidate a prospectus under NI 41-101 for its ETFs that are alternative mutual funds with a prospectus for its ETFs that are conventional mutual funds. There is no reason why mutual funds filing a prospectus under NI 81-101 should be treated differently from ETFs filing a prospectus under NI 41-101.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted.
Purpose Investments Inc. and Purpose Structured Equity Yield Portfolio
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted to fund for extension of the lapse date of prospectus -- Filer will incorporate a new fund into an existing prospectus that qualifies units of an existing fund for distribution -- Extension of lapse date will not affect the currency or accuracy of the information contained in the prospectuses.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 62(5).
September 28, 2020
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of the Fund for a decision under the securities legislation of the Jurisdiction (the Legislation) that the time limits for the renewal of the simplified prospectus of the Fund (the Prospectus) be extended to those time limits that would apply if the lapse date was October 23, 2020 (the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(i) the Ontario Securities Commission is the principal regulator for this application; and
(ii) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision unless otherwise defined.
This decision is based on the following facts represented by the Filer.
1. The Manager is a corporation amalgamated under the laws of the Province of Ontario. The Manager's head office is located in Toronto, Ontario.
2. The Manager is registered as a portfolio manager in British Columbia, Ontario and Québec, an exempt market dealer in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, Québec and Saskatchewan, a commodity trading manager in Ontario and an investment fund manager in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, Québec and Saskatchewan. The Manager is the investment fund manager of the Fund.
3. The Fund is an open-end mutual fund established under the laws of Ontario, and is a reporting issuer as defined in the securities legislation of each of the Jurisdictions.
4. Neither the Manager nor the Fund are in default of securities legislation in any of the Jurisdictions.
5. The Fund currently distributes securities in the Jurisdictions under the Prospectus.
6. Pursuant to subsection 62(1) of the Act, the lapse date of the Prospectus is October 2, 2020 (the Lapse Date). Accordingly, under subsection 62(2) of the Act, the distribution of securities of the Fund would have to cease on the Lapse Date unless: (i) the Fund files a pro forma prospectus at least 30 days prior to the Lapse Date; (ii) the final prospectus is filed no later than 10 days after the Lapse Date; and (iii) a receipt for the final prospectus is obtained within 20 days following the Lapse Date.
7. The Manager is proposing to create a new fund (the New Fund and together with the Fund, the Funds) and to file a combined preliminary and pro forma simplified prospectus and annual information form for the Funds that will be a pro forma filing for securities of the Fund and a preliminary filing for securities of the New Fund. The Manager considered issues associated with the structure of the New Fund and needed additional time to complete its internal review of these issues before filing the preliminary simplified prospectus and annual information form. The Manager filed a combined preliminary and pro forma simplified prospectus and annual information form for the Funds on September 14, 2020.
8. The Manager wishes to offer the Funds under one simplified prospectus in order to reduce renewal and related costs of the Funds. Offering the Funds under one simplified prospectus would facilitate the distribution of the securities of the Funds in the Jurisdictions under the same prospectus and enable the Manager to streamline disclosure across the Funds. As the Fund and the New Fund are both managed by the Manager, offering the Funds under the same prospectus will allow investors to compare their features more easily.
9. The Requested Relief will permit the renewal simplified prospectus of the Fund to include the New Fund.
10. There have been no material changes in the affairs of the Fund since the date of the Prospectus other than those for which amendments have been filed. Accordingly, the Prospectus, annual information form and current Fund Facts of the Fund represent current information regarding the Fund.
11. Given the disclosure obligations of the Filer and the Fund, should any material change in the business, operations or affairs of the Fund occur, the Prospectus, annual information form and current Fund Facts of the Fund will be amended as required under the Legislation.
12. New investors in the Fund will receive delivery of the most recently filed Fund Facts of the Fund. The current Prospectus will remain available to investors upon request.
13. The Requested Relief will not affect the accuracy of the information contained in the Prospectus, annual information form or Fund Facts of the Fund, and will therefore not be prejudicial to the public interest.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Requested Relief is granted.
Summit Industrial Income REIT et al.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Application for exemptive relief to permit issuer and underwriters, acting as agent for the issuer, to enter into an equity distribution agreement to make "at the market" (ATM) distributions of trust units over the facilities of the TSX or other Canadian marketplace -- ATM distributions to be made pursuant to shelf prospectus procedures in Part 9 of NI 44-102 Shelf Distributions -- issuer will issue a press release and file agreements on SEDAR -- application for relief from prospectus delivery requirement -- delivery of prospectus not practicable in circumstances of an ATM distribution -- relief from prospectus delivery requirement has effect of removing two-day right of withdrawal and remedies of rescission or damages for non-delivery of the prospectus -- application for relief from certain prospectus form requirements -- relief granted to permit modified forward-looking certificate language -- relief granted on terms and conditions set out in decision document -- decision will terminate 25 months after the issuance of a receipt for the shelf prospectus -- decision and application also held in confidence by decision makers until the earlier of a public announcement of an ATM distribution, entrance into of an equity distribution agreement, waiver of confidentiality or 90 days from the date of the decision.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 71 and 147.
National Instrument 44-101 Short Form Prospectus Distributions, Part 8 and Item 20 of Form 44-101F1.
National Instrument 44-102 Shelf Distributions, ss. 5.5, 6.3 and 6.7, Part 9, and ss. 2.1 and 2.2 of Appendix A.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions.
August 7, 2020
The Ontario Securities Commission (the Decision Maker), being the principal regulator in the Jurisdiction, has received an application (the Application) from the Filers for a decision under the securities legislation of the Jurisdiction (the Legislation) for the following relief (the Exemption Sought):
(a) that the requirement that a dealer, not acting as agent of the purchaser, who receives an order or subscription for a security offered in a distribution to which the prospectus requirement applies, send or deliver to the purchaser the latest prospectus (including the applicable prospectus supplement(s) in the case of a base shelf prospectus), and any amendment to the prospectus (the Prospectus Delivery Requirement) does not apply to the Agents or any other TSX participating organization or other marketplace participant acting on behalf of the Agents as a selling agent (each, a Selling Agent) in connection with any "at-the-market distribution" (each, an ATM Distribution), as defined in National Instrument 44-102 Shelf Distributions (NI 44-102), of trust units (Units) of the Issuer pursuant to one or more substantially identical equity distribution agreements (each, an Equity Distribution Agreement) to be entered into by the Issuer and the Agents;
(b) that the requirements to include in a prospectus supplement or an amendment thereto, each of the following:
i. a forward-looking issuer certificate of the Issuer in the form specified in section 2.1 or section 2.4, as applicable, of Appendix A to NI 44-102;
ii. a forward-looking underwriter certificate in the form specified in section 2.2 or section 2.4, as applicable, of Appendix A to NI 44-102; and
iii. a statement respecting purchasers' statutory rights of withdrawal and remedies of rescission or damages in substantially the form prescribed by Item 20 of Form 44-101F1 Short Form Prospectus,
(collectively, the Prospectus Form Requirements) do not apply to the Prospectus Supplement (as defined below) or an amendment thereto provided that the Issuer includes in the Prospectus Supplement or an amendment thereto the form of issuer certificate and form of underwriter certificate and includes in the Prospectus Supplement or an amendment thereto the revised description of a purchaser's statutory rights of withdrawal and remedies for rescission or damages described below, in each case (other than with respect to the underwriter certificate) superseding and replacing the corresponding language in the Shelf Prospectus (as defined below) solely with regards to an ATM Distribution.
The Decision Maker has also received a request from the Filers for a decision that the Application and this decision (together, the Confidential Material) be kept confidential and not be made public until the earliest of: (i) the date on which the Filers publicly announce an ATM Distribution; (ii) the date on which the Filers first enter into an Equity Distribution Agreement; (iii) the date the Filers advise the Decision Maker that there is no longer any need for the Confidential Material to remain confidential; and (iv) the date that is 90 days after the date of this decision (the Confidentiality Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) pursuant to subsection 3.6(3)(b) National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions, as the Issuer's head office is located in Ontario, the Ontario Securities Commission is the principal regulator for the Application;
(b) the Filers have provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (Ml 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Northwest Territories, Nunavut and Yukon Territory (collectively and together with the Jurisdiction, the Reporting Jurisdictions); and
(c) this decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority.
Terms defined in MI 11-102, National Instrument 13-101 System for Electronic Document Analysis and Retrieval (SEDAR), National Instrument 14-101 Definitions or NI 44-102 have the same meaning if used in this decision, unless otherwise defined herein. All dollar figures in this decision refer to Canadian dollars.
This decision is based on the following facts represented by the Filers:
The Issuer
1. The Issuer is an unincorporated open-ended limited purpose real estate investment trust established under and governed by the laws of the Province of Ontario. The head office of the Issuer is located in Brampton, Ontario.
2. The Issuer is a reporting issuer in each of the provinces and territories of Canada and is not in default of any requirements under applicable securities legislation in any jurisdiction of Canada.
3. The Units are equity securities as defined in section 1.1 of National Instrument 41-101 General Prospectus Requirements and are listed on the Toronto Stock Exchange (the TSX) under the trading symbol "SMU.UN".
The Agents
4. BMO Nesbitt Burns Inc. is a corporation incorporated under the laws of Canada with its head office located in Toronto, Ontario.
5. Desjardins Securities Inc. is a corporation incorporated under the laws of Canada with its head office located in Montreal, Québec.
6. Each Agent is (i) registered as an investment dealer under the securities legislation of each of the provinces and territories of Canada, (ii) a member of the Investment Industry Regulatory Organization of Canada, and (iii) a participating organization of the TSX.
7. Each Agent is not in default of any requirements under applicable securities legislation in any jurisdiction of Canada.
Proposed ATM Distributions
8. Subject to mutual agreement on terms and conditions, the Filers propose to enter into one or more substantially identical Equity Distribution Agreements for the purpose of ATM Distributions involving the periodic sale of Units by the Issuer through the Agents, as agents, under the shelf prospectus procedures prescribed by Part 9 of NI 44-102.
9. The Issuer filed a short form base shelf prospectus in each of the Reporting Jurisdictions on May 28, 2019 providing for the distribution from time to time of Units and such other securities as the Issuer deems appropriate (the Shelf Prospectus). The Decision Maker issued a receipt for the Shelf Prospectus on May 29, 2019, which receipt was deemed pursuant to MI 11-102 to have been issued by the securities regulatory authority in each of the other Reporting Jurisdictions. Prior to making an ATM Distribution, the Issuer will have filed in each of the Reporting Jurisdictions a prospectus supplement describing the terms of the applicable ATM Distribution, including the terms of the applicable Equity Distribution Agreement and supplementing the disclosure in the Shelf Prospectus (the Prospectus Supplement, and together with the Shelf Prospectus as supplemented or amended and including any documents incorporated by reference therein (which shall include any Designated News Release, as defined below), the Prospectus).
10. Upon entering into an Equity Distribution Agreement, the Issuer will immediately:
(a) issue and file a news release pursuant to section 3.2 of NI 44-102 announcing the applicable Equity Distribution Agreement and indicating that the Shelf Prospectus and the Prospectus Supplement have been filed on SEDAR and disclosing where and how purchasers under the applicable ATM Distribution may obtain copies; and
(b) file the Equity Distribution Agreement on SEDAR.
11. The Issuer will conduct ATM Distributions only through the Agents, as agents, directly, or through a Selling Agent, and only through the methods constituting "at-the-market distributions" within the meaning of NI 44-102, including sales made on the facilities of the TSX or another "marketplace" within the meaning of National Instrument 21-101 Marketplace Operation upon which the Units are listed, quoted or otherwise traded (each, a Marketplace).
12. The Agents will act as the sole agents of the Issuer in connection with an ATM Distribution directly or through one or more Selling Agents on a Marketplace, and will be the sole entities paid an agency fee or commission by the Issuer in connection with such sales. If sales are effected through a Selling Agent, the Selling Agent will be paid a seller's commission for effecting the trades on behalf of the Agents. The Agents will sign an underwriter certificate, in the form set out in paragraph 28 below, in the Prospectus Supplement. A purchaser's rights and remedies under applicable securities legislation against the Agents, as agents of an ATM Distribution through a Marketplace, will not be affected by a decision to effect the sale directly or through a Selling Agent.
13. Under the proposed Equity Distribution Agreements, the Issuer may conduct one or more ATM Distributions subject to the 10% limitation set out in subsection 9.1(1) of NI 44-102.
14. Each Equity Distribution Agreement will provide that, at the time of each sale of Units pursuant to an ATM Distribution, the Issuer will represent to the Agents that the Prospectus contains full, true and plain disclosure of all material facts relating to the Issuer and the Units being distributed. The Issuer will, therefore, be unable to proceed with sales pursuant to an ATM Distribution when it is in possession of undisclosed information that would constitute a material fact or a material change in respect of the Issuer or the Units.
15. During the period after the date of the applicable Prospectus Supplement and before the termination of any ATM Distribution, if the Issuer disseminates a news release disclosing information that, in the Issuer's determination, constitutes a "material fact" (as such term is defined in the Legislation), the Issuer will identify such news release as a "designated news release" for the purposes of the Prospectus. This designation will be made on the face page of the version of such news release filed on SEDAR (any such news release, a Designated News Release). Each Prospectus Supplement will provide that any such Designated News Release will be deemed to be incorporated by reference into the Prospectus. A Designated News Release will not be used to update disclosure in the Prospectus by the Issuer in the event of a "material change" (as such term is defined in the Legislation).
16. If, after the Issuer delivers a sell notice to the Agents directing the Agents to sell Units on the Issuer's behalf pursuant to the applicable Equity Distribution Agreement (a Sell Notice), the sale of Units specified in the Sell Notice, taking into consideration prior sales under previous ATM Distributions, would constitute a material fact or material change, the Issuer will suspend sales under the Equity Distribution Agreement until either: (i) it has filed a Designated News Release or material change report, as applicable, or amended the Prospectus; or (ii) circumstances have changed such that the sales would no longer constitute a material fact or material change.
17. In determining whether the sale of the number of Units specified in a Sell Notice would constitute a material fact or material change, the Issuer will take into account a number of factors, including, without limitation: (i) the parameters of the Sell Notice, including the number of Units proposed to be sold and any price or timing restrictions that the Issuer may impose with respect to the particular ATM Distribution; (ii) the percentage of the outstanding Units that the number of Units proposed to be sold pursuant to the Sell Notice represents; (iii) the trading volume and volatility of the Units; (iv) recent developments in the business, affairs and capital structure of the Issuer; (v) sales under earlier Sell Notices; and (vi) prevailing market conditions generally.
18. In addition, the Agents will monitor closely the market's reaction to trades made on any Marketplace pursuant to an ATM Distribution in order to evaluate the likely market impact of future trades. Each Agent has experience and expertise in managing sell orders to limit downward pressure on trading prices. If the Agents have concerns as to whether a particular sell order placed by the Issuer may have a significant effect on the market price of the Units, the Agents will recommend against effecting the trades pursuant to the applicable Sell Notice at that time. It is in the interest of both the Issuer and the Agents to minimize the market impact of sales under an ATM Distribution.
Disclosure of Units Sold in ATM Distributions
19. The Issuer will disclose in its annual and interim financial statements and management discussion and analysis filed on SEDAR in respect of that financial period, the number and average price of Units sold pursuant to ATM Distributions during that annual or interim financial period, as well as total gross proceeds, commissions paid or payable and net proceeds.
Prospectus Delivery Requirement
20. Pursuant to the Prospectus Delivery Requirement, a dealer effecting a trade of securities offered under a prospectus is required to deliver a copy of the prospectus (including the applicable prospectus supplement(s) in the case of a base shelf prospectus) to the purchaser within prescribed time limits.
21. The delivery of a prospectus is not practicable in the circumstances of an ATM Distribution, as neither the Agents nor a Selling Agent effecting the trade will know the identity of the purchasers.
22. The Prospectus will be filed and readily available to all purchasers electronically via SEDAR. As stated in paragraph 10 above, the Issuer will issue a news release that specifies where and how copies of the Prospectus can be obtained.
23. The liability of an issuer or an underwriter (or others) for a misrepresentation in a prospectus pursuant to the civil liability provisions of the Legislation will not be affected by the grant of an exemption from the Prospectus Delivery Requirement, because purchasers of securities offered by a prospectus during the period of distribution have a right of action for damages or rescission, without regard to whether the purchaser relied on the misrepresentation or in fact received a copy of the prospectus.
Withdrawal Right and Right of Action for Non-Delivery
24. Pursuant to the Legislation, an agreement to purchase securities in respect of a distribution to which the prospectus requirement applies is not binding on the purchaser if a dealer receives, not later than midnight on the second day (exclusive of Saturdays, Sundays and holidays) after receipt by the purchaser of the latest prospectus or any amendment to the prospectus, a notice in writing that the purchaser does not intend to be bound by the agreement of purchase (the Withdrawal Right).
25. Pursuant to the Legislation, a purchaser of securities to whom a prospectus was required to be sent or delivered in compliance with the Prospectus Delivery Requirement, but was not so sent or delivered, has a right of action for rescission or damages against the dealer who did not comply with the Prospectus Delivery Requirement (the Right of Action for Non-Delivery).
26. Neither the Withdrawal Right nor the Right of Action for Non-Delivery is workable in the context of an ATM Distribution because of the impracticability of delivering the Prospectus to a purchaser of Units thereunder.
Prospectus Form Requirements
27. To reflect the fact that the ATM Distribution is a continuous distribution, the Prospectus Supplement and any amendment thereto will include the following issuer certificate in substitution for the certificate prescribed by the Prospectus Form Requirements (with appropriate modifications in respect of the filing of an amendment prescribed by section 2.4 of Appendix A to NI 44-102), such issuer certificate to supersede and replace the issuer certificate in the Shelf Prospectus, solely with regards to the ATM Distribution:
"The short form prospectus, together with the documents incorporated in the prospectus by reference, as supplemented by the foregoing, will, as of the date of a particular distribution of securities under the prospectus, constitute full, true and plain disclosure of all material facts relating to the securities offered by the prospectus and the supplement as required by the securities legislation of each of the provinces and territories of Canada."
28. To reflect the fact that the ATM Distribution is a continuous distribution, the Prospectus Supplement and any amendment thereto will include the following underwriter certificate (with appropriate modifications in respect of the filing of an amendment prescribed by section 2.4 of Appendix A to NI 44-102) in substitution for the certificate prescribed by the Prospectus Form Requirements:
"To the best of our knowledge, information and belief, the short form prospectus, together with the documents incorporated in the prospectus by reference, as supplemented by the foregoing, will, as of the date of a particular distribution of securities under the prospectus, constitute full, true and plain disclosure of all material facts relating to the securities offered by the prospectus and this supplement, as required by the securities legislation of each of the provinces and territories of Canada."
29. A different statement of purchasers' rights than that required by the Legislation is necessary so that the Prospectus Supplement will accurately reflect the relief granted from the Prospectus Delivery Requirement. Accordingly, the Prospectus Supplement will state the following with the date reference completed, in substitution for the language prescribed by the Prospectus Form Requirements:
"Securities legislation in some provinces and territories of Canada provides purchasers of securities with the right to withdraw from an agreement to purchase securities and with remedies for rescission or, in some jurisdictions, revisions of the price, or damages if the prospectus, prospectus supplement, and any amendment relating to securities purchased by a purchaser are not sent or delivered to the purchaser. However, purchasers of Units distributed under an at-the-market distribution by the REIT do not have the right to withdraw from an agreement to purchase the Units and do not have remedies of rescission or, in some jurisdictions, revisions of the price, or damages for non-delivery of the prospectus, prospectus supplement, and any amendment relating to the Units purchased by such purchaser because the prospectus, prospectus supplement, and any amendment relating to the Units purchased by such purchaser will not be sent or delivered, as permitted under either (i) a decision dated [•], 2020 granted pursuant to National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions; or (ii) Part 9 of National Instrument 44-102 Shelf Distributions, as applicable.
Securities legislation in some provinces and territories of Canada further provides purchasers with remedies for rescission or, in some jurisdictions, revisions of the price or damages if the prospectus, prospectus supplement, and any amendment relating to securities purchased by a purchaser contains a misrepresentation. Those remedies must be exercised by the purchaser within the time limit prescribed by securities legislation. Any remedies under securities legislation that a purchaser of Units distributed under an at-the-market distribution by the REIT may have against the REIT or its agents for rescission or, in some jurisdictions, revisions of the price, or damages if the prospectus, prospectus supplement, and any amendment relating to securities purchased by a purchaser contain a misrepresentation will remain unaffected by the non-delivery of the prospectus, and the decision referred to above (if applicable).
A purchaser should refer to applicable securities legislation and the decision referred to above (if applicable) for the particulars of these rights and should consult a legal adviser."
30. The Prospectus Supplement will disclose that, solely with regards to the ATM Distribution, the statement in paragraph 29 above supersedes and replaces the statement of purchasers' rights contained in the Shelf Prospectus.
The Decision Maker is satisfied that this decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Maker under the Legislation is that the Exemption Sought is granted provided that:
(a) during the 60-day period ending not earlier than 10 days prior to the commencement of an ATM Distribution, the Units have traded, in total, on one or more Marketplaces, as reported on a consolidated market display:
(i) an average of at least 100 times per trading day; and
(ii) with an average trading value of at least $1,000,000 per trading day;
(b) the Issuer complies with the disclosure requirements set out in paragraphs 19, 27, 28, 29, and 30; and
(c) the Issuer and the Agents respectively comply with the representations made in paragraphs 10, 11, 12, 13, 14, 15, 16, 17 and 18.
This decision will terminate on the expiry or withdrawal of the Shelf Prospectus (currently expected to be June 29, 2021, being the date that is 25 months from the date of the receipt for the Shelf Prospectus).
The further decision of the Decision Maker is that the Confidentiality Relief in respect of the Exemption Sought is granted.
As to the Exemption Sought from the Prospectus Delivery Requirement and the Confidentiality Relief:
"Cecilia Williams"CommissionerOntario Securities Commission"Mary Anne De Monte-Whelan"CommissionerOntario Securities Commission
As to the Exemption Sought from the Prospectus Delivery Requirement, the Prospectus Form Requirements and the Confidentiality Relief:
"Jo-Anne Matear"Manager, Corporate FinanceOntario Securities Commission
SEI Investments Canada Company and Richardson GMP Limited
National Policy 11-203 -- Process for Exemptive Relief Applications in Multiple Jurisdictions -- Revocation of prior relief -- relief from the requirement in subsections 5.2(1), (3) and (4) of NI 81-101 to allow dealer to physically deliver or electronically send in a single email attachment or single document accessible through a hyperlink one document containing the fund facts documents of all of the funds in a model portfolio, along with a cover page, in respect of purchases of securities of the funds made pursuant to a model portfolio program, subject to certain conditions -- National Instrument 81-101 Mutual Fund Prospectus Disclosure.
National Instrument 81-101 Mutual Fund Prospectus Disclosure, ss. 3.2.01(1), 5.2(1), 5.2(3) and 5.2(4), and 6.1.
August 19, 2020
The principal regulator in the Jurisdiction has received an application from SEI on behalf of the Funds (as defined below) and the Representative Dealer for a decision under the securities legislation of the Jurisdiction (the Legislation):
(a) revoking the decision granted by the principal regulator (the Revocation) on July 15, 2020 (the Prior Decision); and
(b) exempting each Dealer (as defined below) from:
(i) subsection 5.2(1) of National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101), which prohibits a fund facts document (Fund Facts), if being delivered under the pre-sale delivery requirement for Fund Facts (the Fund Facts Delivery Requirement), from being combined with any other materials or documents;
(ii) subsection 5.2(3) of NI 81-101, which prohibits multiple Fund Facts, if being delivered electronically at the same time, from being combined into a single email attachment or a single document accessible through a hyperlink; and
(iii) subsection 5.2(4) of NI 81-101, which prohibits a Fund Facts, if being delivered or sent under certain exceptions from the Fund Facts Delivery Requirement, from being combined with any other materials or documents, except for certain exceptions (collectively, the Bundling Restrictions)
in order to physically deliver or electronically send, in a single email attachment or a single document accessible through a hyperlink, one document containing the Fund Facts for all the Funds (as defined below) forming part of an SEI Portfolio (as defined below), along with a cover page, in respect of purchases of securities of the Funds under the Service (as defined below) (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filers have provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Québec, Saskatchewan and Yukon (the Other Jurisdictions, and together with Ontario, the Canadian Jurisdictions).
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
This decision is based on the following facts represented by the Filers:
SEI and the Funds
1. SEI is an unlimited liability company organized under the laws of the Province of Nova Scotia. The registered office of SEI is located in Toronto, Ontario.
2. SEI is registered as a portfolio manager and an exempt market dealer in each of the Canadian Jurisdictions, and as an investment fund manager in Ontario, Newfoundland and Labrador, and Québec. SEI is also registered under the Commodity Futures Act (Ontario) as an adviser in the category of commodity trading manager.
3. SEI is the investment fund manager of certain mutual funds (the Existing Funds) that form part of the SEI Portfolios model portfolio service described below (the Service). SEI may, in the future, also become the manager of additional mutual funds (the Future Funds and, together with the Existing Funds, the Funds) that will also form part of the Service.
4. Each of the Funds is, or will be, a reporting issuer in one or more of the Canadian Jurisdictions, and subject to the requirements of National Instrument 81-102 Investment Funds (NI 81-102). Securities of the Funds are, or will be, qualified for sale pursuant to a simplified prospectus, annual information form and Fund Facts that have been, or will be, prepared and filed in accordance with NI 81-101.
5. The Funds are, or will be, open-ended mutual funds established under the laws of Ontario.
6. Except as described in representation 16 below, SEI is not in default of securities legislation in any of the Canadian Jurisdictions. The Funds are not in default of securities legislation in any of the Canadian Jurisdictions.
The Dealers
7. Securities of the Funds are, or will be, distributed through dealers that are unaffiliated with SEI, including the Representative Dealer (the Dealers, and each, a Dealer).
8. The Representative Dealer is registered as an investment dealer and is a member of the Investment Industry Regulatory Organization of Canada (IIROC).
9. Each Dealer is, or will be: (a) registered in the applicable Canadian Jurisdictions as a dealer in the category of mutual fund dealer and, other than mutual fund dealers registered in Québec, is, or will be, a member of the Mutual Fund Dealers Association; or (b) registered in the applicable Canadian Jurisdictions as a dealer in the category of investment dealer and is, or will be, a member of IIROC.
10. Except as described in representation 17 below, the Representative Dealer is not in default of securities legislation in any of the Canadian Jurisdictions.
The Service
11. Through the Service, SEI constructs and makes available to investors, through Dealers, asset allocation portfolios which are invested exclusively in various combinations of the Funds (the SEI Portfolios, and each, an SEI Portfolio).
12. The Service offers a number of SEI Portfolios, each of which is comprised of a selection of Funds and corresponds to a different investment objective, investment horizon and risk profile. The SEI Portfolios are designed to meet a wide range of investor goals, from capital preservation to maximum growth, and span a broad risk-return spectrum.
13. Each SEI Portfolio is, and will be, comprised entirely of Funds for which SEI acts as investment fund manager.
14. Each SEI Portfolio has a specified target fund allocation that defines the percentage of the portfolio to be invested (the Target Weighting) in each Fund.
15. Each investor in an SEI Portfolio must accept all of the Funds in the SEI Portfolio and the Targeted Weighting of each of those Funds.
16. SEI has received exemptive relief to address compliance with the dealer registration, know-your-client, suitability and account reporting requirements in the Legislation in respect of the Service.
17. SEI and the Representative Dealer, on behalf of each Dealer, have applied for exemptive relief to address compliance with the Fund Facts Delivery Requirement in the Legislation in respect of the Service.
The Exemption Sought
18. Each investor in an SEI Portfolio makes one investment decision, which is the selection of their chosen SEI Portfolio, causing the investor to invest in multiple Funds comprising their chosen SEI Portfolio.
19. The Filer believes that combining all of the Fund Facts for the Funds in an SEI Portfolio in one document, in paper or electronic form in a single email attachment or a single document accessible through a hyperlink, along with a cover page, rather than delivering or sending separate multiple Fund Facts documents:
(a) will allow investors to better understand that an SEI Portfolio is composed of several Funds with their own characteristics;
(b) will facilitate the review of information provided in the Fund Facts of each Fund forming part of the selected SEI Portfolio; and
(c) will not be so extensive as to cause a reasonable person to conclude that the combination prevents the information from being presented in a simple, accessible and comparable format.
20. In the absence of the Exemption Sought, a Dealer would be required to comply with the Bundling Restrictions.
21. The Filers previously obtained relief from the Bundling Restrictions in respect of purchases of securities of the Funds under the Service in the Prior Decision. Due to inadvertence, the Prior Decision did not include conditions 2(b) and (c) below. The Revocation and issuance of a new decision in respect of the Exemption Sought will address this issue.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that:
1. the Revocation is granted; and
2. the Exemption Sought is granted provided that:
(a) when a Fund Facts is required to be delivered or sent to the purchaser, for all the Funds forming part of an SEI Portfolio under the Service, the Dealer physically delivers or electronically sends, in a single email attachment or single document accessible through a hyperlink, one document containing only the following:
(i) the Fund Facts for all the Funds in the SEI Portfolio; and
(ii) a cover page containing:
a. the name of the particular SEI Portfolio;
b. a statement about the delivery of the Fund Facts that make up the SEI Portfolio;
c. the name of each Fund comprising the SEI Portfolio; and
d. the specified Target Weighting for each Fund in the SEI Portfolio;
(b) SEI provides to the principal regulator, on an annual basis, beginning 60 days after the date upon which the Exemption Sought is first relied upon by a Dealer, either:
(i) a current list of all such Dealers that are relying on the Exemption Sought; or
(ii) an update to the list of such Dealers or confirmation that there has been no change to such list; and
(c) prior to a Dealer relying on the Exemption Sought, SEI provides to the Dealer a disclosure statement informing the Dealer of the implications of this decision.
Summit Industrial Income REIT -- s. 5.1 of OSC Rule 48-501 Trading During Distributions, Formal Bids and Share Exchange Transactions
Application for a decision, pursuant to section 5.1 of OSC Rule 48-501, exempting the Filer from trading restrictions imposed by section 2.2(a) of OSC Rule 48-501. Decision granted. Decision and application also held in confidence by the decision makers until the earliest of (i) the date on which the Filer publicly announces an ATM Distribution, (ii) the date on which the Filer first enters into an Equity Distribution Agreement as described below, (iii) the date on which the Filer advises the Decision Maker that there is no longer any need for the Confidential Material to remain confidential, and (iv) the date that is 90 days after the date of this decision.
Ontario Securities Commission Rule 48-501 -- Trading During Distributions, Formal Bids and Share Exchange Transactions.
August 7, 2020
The securities regulator in the Jurisdiction (the Decision Maker) has received an application (the Application) from the Filer pursuant to the procedures set forth in OSC Policy 2.1 Applications to the Ontario Securities Commission for a decision under the securities legislation of the Jurisdiction (the Legislation) that the requirement in section 2.2(a) of the Rule do not apply to insiders of the Filer (the Insiders) in connection with any ATM Distributions (as defined below) made by the Filer under an Equity Distribution Agreement (as defined below) (the Exemptive Relief Sought).
The Decision Maker has also received a request from the Filer for a decision that the Application and this decision (together, the Confidential Material) be kept confidential and not be made public until the earliest of: (i) the date on which the Filer publicly announces an ATM Distribution, (ii) the date on which the Filer first enters into an Equity Distribution Agreement as described below, (iii) the date on which the Filer advises the Decision Maker that there is no longer any need for the Confidential Material to remain confidential, and (iv) the date that is 90 days after the date of this decision (together, the Confidentiality Relief).
Terms defined in National Instrument 14-101 Definitions, National Instrument 21-101 -Marketplace Operation and National Instrument 13-101 System for Electronic Document Analysis and Retrieval (SEDAR) or the Rule have the same meaning if used in this decision, unless otherwise defined herein. All dollar figures in this decision refer to Canadian dollars.
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is an unincorporated open-ended limited purpose real estate investment trust established under and governed by the laws of the Province of Ontario. The head office of the Filer is located in Brampton, Ontario.
2. The Filer is a reporting issuer in each province and territory of Canada and is not in default of securities legislation in any jurisdiction of Canada.
3. The Filer's trust units (the Units) are listed on the Toronto Stock Exchange (the TSX) under the trading symbol "SMU.UN".
4. The Units meet the requirements in the Rule to be considered a "highly-liquid security".
Proposed ATM Distributions
5. The Filer filed a short form base shelf prospectus in each of the provinces and territories of Canada on May 28, 2019 providing for the distribution from time to time of Units and such other securities as the Filer deems appropriate (the Shelf Prospectus).
6. The Filer intends to conduct one or more "at-the-market distributions" of Units in Canada (ATM Distributions) within the meaning of, and pursuant to the shelf prospectus procedures prescribed in, Part 9 of National Instrument 44-102 Shelf Distributions (NI 44-102), to be made pursuant to the terms and conditions of one or more substantially identical equity distribution agreements (each, an Equity Distribution Agreement) to be entered into between the Filer and certain agents (the Agents).
7. Subject to mutual agreement on terms and conditions, the Filer is proposing to enter into one or more Equity Distribution Agreements with the Agents, providing for the sale of Units from time to time by the Filer through the Agents pursuant to an ATM Distribution under the shelf prospectus procedures prescribed by Part 9 of NI 44-102.
8. Prior to making an ATM Distribution, the Filer will have filed in each of the provinces and territories of Canada a prospectus supplement describing the terms of an ATM Distribution, including the terms of the applicable Equity Distribution Agreement and otherwise supplementing the disclosure in the Shelf Prospectus (the Prospectus Supplement, and together with the Shelf Prospectus as supplemented or amended and including any documents incorporated by reference therein, the Prospectus).
9. Each Equity Distribution Agreement will provide that, at the time of each sale of Units pursuant to an ATM Distribution, the Filer will represent to the Agents that the Prospectus contains full, true and plain disclosure of all material facts relating to the Filer and the Units being distributed. It is therefore likely that a significant portion of the sales activity under ATM Distributions will occur during periods that coincide with the Filer's typical Trading Window (as defined below) under its Trading Policy (as defined below).
Unit Ownership Policy
10. Under the Filer's current minimum Unit ownership policy (the Ownership Policy), the Chief Executive Officer (the CEO) of the Filer must, within three years of becoming CEO, hold at least three times the value of his or her base salary averaged over the three most recent years in Units and/or deferred trust units, and each trustee of the Filer (each a Trustee) must, within five years of becoming a Trustee, hold at least three times the value of his or her base retainer averaged over the three most recent years.
11. The Filer believes that the Ownership Policy is in-line with best corporate governance practices and that it is in the Filer's best interest to avoid imposing any unnecessary restrictions on the ability of Insiders to increase their equity stake in the Filer.
12. Under the terms of the Filer's trading policy for employees and Insiders (the Trading Policy), Trustees and officers of the Filer, as well as certain other individuals, may only trade Units while the Filer is not in a "blackout" period (a Trading Window). Regularly scheduled blackout periods commence on the last day at the end of each fiscal quarter of the Filer and end at the conclusion of the second business day following the issuance of a news release in respect of the Filer's quarterly or annual financial results. If the Filer puts in place an ATM Distribution, distributions by the Filer may occur during a Trading Window.
13. Pursuant to section 2.2(a) of the Rule, an insider of a reporting issuer is prohibited from bidding on or purchasing securities of that reporting issuer during the period commencing on the date that is two trading days prior to the day the offering price is determined for a prospectus offering of that reporting issuer, and ending on the date the selling process ends and all stabilization arrangements relating to the offered security are terminated (the Insider Purchasing Restriction).
14. These restrictions in the Rule were not designed in contemplation of ATM Distributions. Subsection 1.2(5)(a)(i) of the Rule provides the following interpretative guidance:
the selling process shall be considered to end, in the case of a prospectus distribution, if a receipt has been issued for the final prospectus, the dealer has allocated all of its portion of the securities to be distributed under the prospectus and all selling efforts have ceased
however such guidance does not apply in the context of an ATM Distribution, where the receipt is obtained before the distribution begins, the dealers do not allocate a position (but rather simply trade on a "marketplace", within the meaning of National Instrument 21-101 Marketplace Operation) and no selling efforts are made (only ordinary trading activity).
15. Similarly, the exemption in section 3.2(e) of the Rule, in respect of "a subscription for or purchase of an offered security pursuant to a prospectus distribution", is not possible to apply in the context of an ATM Distribution, given that insiders purchasing on a marketplace during an ATM Distribution would have no knowledge as to whether they are purchasing under an ATM Distribution or otherwise from a counterparty unrelated to the Filer.
16. The stated policy rationale for the Rule is to prohibit "purchases of or bids for restricted securities in circumstances where there is heightened concern over the possibility of manipulation by those with an interest in the outcome of the distribution or transaction".{1}
17. In the case of the Filer, given that:
(a) the Units constitute a "highly liquid security" and are liquid to such a degree that it would be virtually impossible for an Insider to manipulate the trading price of the Units through purchases;
(b) most Insiders will, in any event, be unaware of when each ATM Distribution begins and ends and discrete sales of Units thereunder occur; and
(c) any Insider that is purchasing Units on the market during an ATM Distribution will not know whether it is purchasing under an ATM Distribution or from another counterparty unrelated to the Filer;
there is no policy rationale for applying the Insider Purchasing Restriction to Insiders in the context of an ATM Distribution.
18. In the absence of an exemption from the Insider Purchasing Restriction, Insiders would be restricted from bidding on and purchasing Units during a period of time prior to and during each ATM Distribution by the Filer, which could overlap with the Trading Windows and unduly and unnecessarily impede Trustees and officers of the Filer from making purchases of Units, including for the purposes of complying with the Ownership Policy.
Confidentiality
19. The Filer submits that the Confidentiality Relief is warranted in the circumstances as there is otherwise a risk of the public being misled into believing, on the basis of the Confidential Material being available to the public before the earliest of the proposed expiration dates, that implementation of the contemplated ATM Distribution arrangement by the Filer is imminent when in fact the parties have not yet come to a definitive agreement and the Filer may decide not to proceed with an ATM Distribution in the near term, or at all, depending on market conditions and other factors outside of the Filer's control. Such premature disclosure could cause confusion and uncertainty in the market and would be contrary to the public interest.
20. In recognition of the general principles of access under the Act, however, the Filer proposes that the Confidentiality Relief be limited to a maximum duration of 90 days from the date of this decision. This period is believed to provide the Filer with sufficient time within which to negotiate a definitive Equity Distribution Agreement or otherwise make a final determination on the matter, and strikes an appropriate balance between the Filer's legitimate concerns about premature disclosure and principles of public access to filed materials.
21. Upon a definitive Equity Distribution Agreement being settled between the Filer and the Agents, the Filer's ordinary disclosure obligations will apply and news of the proposed ATM Distribution arrangement would be disseminated in the ordinary course.
The Decision Maker is satisfied that the decision meets the test set out in the Legislation.
The decision of the Decision Maker under the Legislation is that the Exemptive Relief Sought is granted.
DATED this 7th day of August, 2020.
{1} OSC Request for Comment on Changes to Proposed OSC Rule 48-501 -- Trading During Distributions, Formal Bids and Share Exchange Transactions (2nd Publication) and Proposed Companion Policy 48-501CP to OSC Rule 48-501 and Proposed Rescission of OSC Policy 5.1, Paragraph 26 and OSC Policy 62-601 -- Securities Exchange Take-Over Bids -- Trades in the Offeror's Securities (September 10, 2004).
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted from subsection 6.1(1) of NI 81-102 to permit alternative mutual funds and other mutual funds to exclude the aggregate market value of proceeds from outstanding short sales of portfolio securities held by the borrowing agent, from the limits of 25% of an alternative mutual fund's net asset value and 10% of a mutual fund's that is not an alternative mutual fund's net asset value that may be deposited with a borrowing agent that is not the fund's custodian or sub-custodian as security in connection with a short sale -- subject to routine conditions.
National Instrument 81-102 Investment Funds, ss. 6.1(1) and 19.1.
September 15, 2020
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of Evolve Gold Miners Fund (GLC), any alternative mutual fund established in the future and managed by the Filer or an affiliate of the Filer (collectively with GLC, the Alternative Mutual Funds) and any current or future mutual fund, other than an Alternative Mutual Fund, managed by the Filer or an affiliate of the Filer (each, a Mutual Fund and, together with the Alternative Mutual Funds, the Funds) for a decision under the securities legislation of the principal regulator (the Legislation) exempting the Funds from the requirement set out in subsection 6.1(1) of National Instrument 81-102 Investment Funds (NI 81-102) that provides that, except as provided in section 6.8, 6.8.1 and 6.9 of NI 81-102, all portfolio assets of an investment fund must be held under the custodianship of one custodian that satisfies the requirements of section 6.2, in order to permit a Fund to deposit portfolio assets with a borrowing agent that is not the Fund's custodian or sub-custodian in connection with a short sale of securities, if the aggregate market value of the portfolio assets held by the borrowing agent after such deposit, excluding the aggregate market value of the proceeds from outstanding short sales of securities held by the borrowing agent, does not:
(a) in the case of each Mutual Fund, exceed 10% of the net asset value (NAV) of the Mutual Fund at the time of deposit; and
(b) in the case of each Alternative Mutual Fund, exceed 25% of the NAV of the Alternative Mutual Fund at the time of deposit,
(the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for the application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in all of the provinces and territories of Canada other than the Jurisdiction (collectively with the Jurisdiction, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Prime Broker means any entity that acts as, among other things, a borrowing agent to one or more investments funds.
This decision is based on the following facts represented by the Filer:
1. The Filer is registered as (a) an investment fund manager in Newfoundland and Labrador, Ontario and Québec; (b) a commodity trading manager in Ontario; and (c) a portfolio manager in Ontario.
2. The Filer or an affiliate of the Filer is, or will be, the investment fund manager of each of the Funds.
3. GLC (currently called "Gold Miners Split Corp.") is currently structured as a split share corporation, and is authorized to issue an unlimited number of preferred shares, Class A shares and common shares. The preferred shares and Class A shares of GLC were distributed pursuant to an initial offering under a long form prospectus prepared in accordance with the requirements of National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) and National Instrument 41-101 General Prospectus Requirements (NI 41-101) dated April 26, 2019 in all of the Jurisdictions.
4. GLC is currently undergoing a restructuring, pursuant to which, among other things, the preferred shares of GLC will be redeemed and cancelled, and the Class A shares of GLC will be re-designated as exchange traded fund shares (the ETF Shares) of a new non-cumulative, redeemable, non-voting class of shares to be called "Evolve Gold Miners Fund" (collectively, the Restructuring).
5. The Filer has filed a preliminary prospectus and preliminary ETF Facts document dated August 17, 2020 in all of the Jurisdictions with respect to the ETF Shares. Following the completion of the Restructuring, GLC will become subject to the requirements of NI 81-102 that relate to alternative mutual funds.
6. Each Fund is, or will be, a reporting issuer in one or more Jurisdictions and distributes its units or shares, as applicable, to the public pursuant to disclosure documents prepared and filed in accordance with NI 81-101 or NI 41-101.
7. None of the Filer, GLC, or an existing Fund is in default of securities legislation in any Jurisdiction.
8. In connection with, among other things, the short sale of securities that the Funds will or may engage in, each Fund is permitted to grant a security interest in favour of, and deposit pledged portfolio assets with, the entity that acts as, among other things, a Prime Broker to it, whether the Fund is an Alternative Mutual Fund or a Mutual Fund.
9. Effective as of January 3, 2019, NI 81-102 was amended to include alternative mutual funds. The ability of alternative mutual funds to participate in leverage transactions, such as to borrow cash and to sell short securities, more extensively than other investment funds governed by NI 81-102 has led to the increased involvement of Prime Brokers in the operations of these alternative mutual funds. While the prime brokerage model works well in the exempt investment fund space, the prime brokerage community and investment fund managers are experiencing greater difficulties in applying that model to alternative mutual funds and other investment funds under NI 81-102.
10. Under section 6.8.1 of NI 81-102, if a Mutual Fund engages as its Prime Broker an entity that is not its custodian or sub-custodian, then it may only deliver to its Prime Broker portfolio assets having a market value, in the aggregate, of not more than 10% of the NAV of the Mutual Fund at the time of deposit. If an Alternative Mutual Fund engages as its Prime Broker an entity that is not its custodian or sub-custodian, then it may only deliver to its Prime Broker portfolio assets having a market value, in the aggregate, of not more than 25% of the NAV of the Alternative Mutual Fund at the time of deposit.
11. A Prime Broker may not wish to act as borrowing agent for a Mutual Fund that wants to sell short securities having an aggregate market value of up to 20% of the Mutual Fund's NAV if the Prime Broker is only permitted to hold as security for such transactions portfolio assets, including the proceeds from the short sale, having an aggregate market value that is not in excess of 10% of the NAV of the Mutual Fund.
12. The issue is even greater in the context of an Alternative Mutual Fund, as a Prime Broker will not want to act as borrowing agent for an Alternative Mutual Fund that wants to sell short securities having an aggregate market value of up to 50% of the Alternative Mutual Fund's NAV if the Prime Broker is only permitted to hold as security for such transactions portfolio assets, including the proceeds from the short sale, having an aggregate market value that is not in excess of 25% of the NAV of the Alternative Mutual Fund.
13. The prime brokerage operational and pricing models in the context of short selling are premised on the ability of the Prime Broker to retain, as collateral for the obligations of the applicable Fund, the proceeds from the short sales, whether such proceeds are cash or are used by the Fund to purchase other portfolio assets. These models are also based on the ability of the Prime Broker to hold additional assets of the Fund as collateral for those obligations.
14. Many Prime Brokers that are qualified to act as a custodian or sub-custodian under NI 81-102 are not widely appointed as custodians or sub-custodians under NI 81-102 as it can be both operationally challenging and costly to appoint them to act in such capacity.
15. Given the typical collateral requirements that Prime Brokers impose on their customers that engage in the short sale of securities, if the 10% and 25% of NAV limitations set out in section 6.8.1 of NI 81-102 apply, then the Funds will need to retain two or more Prime Brokers in order to sell short securities to the extent permitted under section 2.6.1 of NI 81-102. This will result in inefficiencies for the Funds, increase their costs of operations, reduce returns and negatively impact investors.
16. While the collateral limits for the short sale of securities is currently topical in the context of alternative mutual funds, the Filer submits that there is no policy reason to differentiate between Alternative Mutual Funds and Mutual Funds to the extent that Mutual Funds also engage in the short selling of securities.
17. The Filer submits that it is not prejudicial to the public interest to grant the Exemption Sought.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that the Funds otherwise comply with subsections 6.8.1(2) and (3) of NI 81-102.
I.G. Investment Management, Ltd.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- exemption from section 2.1(1) of National Instrument 81-102 -- Investment Funds to invest in debt securities issued by the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) -- relief is required to allow funds to invest more than 10 percent of their net asset value in Fannie Mae and Freddie Mac -- Fannie Mae and Freddie Mac are implicitly guaranteed by the U.S. government -- Fannie Mae and Freddie Mac are government sponsored entities in the U.S. -- Fannie Mae and Freddie Mac has a U.S. government equivalent credit rating -- relief subject to certain conditions.
National Instrument 81-102 Investment Funds, ss. 2.1(1) and 19.1.
September 22, 2020
The securities regulatory authority or regulator in each of the Jurisdictions has received an application from the Filer on behalf of the Current Funds and any future mutual funds the Manager may launch (the Future Funds and, together with the Current Funds, the Funds and, individually, a Fund) that are sub-advised by PIMCO Canada Corp. or its affiliates (PIMCO and its affiliates are collectively referred to herein as PIMCO), for a decision under the securities legislation of the Jurisdiction (the Legislation) that grants exemptive relief to the Filer and the Fund from subsection 2.1(1) of National Instrument 81-102 Investment Funds (NI 81-102) to permit each Fund that is a mutual fund, other than an alternative mutual fund, to purchase a security of an issuer, enter into a specified derivative transaction or purchase index participation units (each a Purchase) when, immediately after the Purchase, more than 10 percent of the net asset value of the Fund would be invested in debt obligations issued or guaranteed by either the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac) (the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Manitoba Securities Commission is the principal regulator for this application;
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in in British Columbia, Alberta, Saskatchewan, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, Nunavut and the Northwest Territories; and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in National Instrument 14-101 Definitions, MI 11-102, and NI 81-102 have the same meaning if used in this decision, unless otherwise defined. In addition:
1940 Act means the United States Investment Company Act of 1940, as amended from time to time;
Fannie and Freddie Securities means debt obligations issued or guaranteed by either Fannie Mae or Freddie Mac including, without limitation, bonds and mortgage-backed securities and Fannie or Freddie Security means any one such debt obligation;
Minimum Rating means a credit rating of BBB- assigned by Standard & Poor's Rating Service or an equivalent rating by one or more other designated rating organizations; and
U.S. Government Equivalent Rating means a credit rating assigned by Standard & Poor's Rating Services (Canada), or an equivalent rating assigned by one or more other designated rating organizations, to a Fannie or Freddie Security that is not less than the credit rating then assigned by such designated rating organization to the debt of the United States government of approximately the same term as the remaining term to maturity of, and denominated in the same currency as, the Fannie or Freddie Security.
This decision is based on the following facts represented by the Filer:
IGIM
1. IGIM is a corporation continued under the laws of Ontario. It is the trustee, the portfolio advisor and the manager of the Fund. The head office of IGIM is in Winnipeg, Manitoba.
2. IGIM is registered as a Portfolio Manager and an Investment Fund Manager in Manitoba, Ontario, and Quebec and as an Investment Fund Manager in Newfoundland and Labrador.
3. IGIM and the mutual funds it manages or advises are not in default of any of the requirements of securities legislation of any of the provinces and territories of Canada.
The Funds
4. The Funds are mutual fund subject to NI 81-102, subject to any exemptions therefrom that have been, or may be, granted by the applicable securities regulatory authorities. The Funds distribute its securities under a simplified prospectus and annual information form prepared in accordance with National Instrument 81-101 -- Mutual Fund Prospectus Disclosure. The Funds are or will be reporting issuers in one or more of the provinces and territories of Canada and are or will be sub-advised by PIMCO.
5. The investment objective of the PIMCO -- IG Global Bond Pool is to provide interest income by investing primarily in bonds and debentures of non-Canadian issuers.
6. The investment objective of the IG PIMCO Global Bond Fund is to provide interest income by investing primarily in bonds and debentures of non-Canadian issuers. The Fund aims to achieve this exposure by investing primarily in Underlying Funds and/or directly in fixed income investments.
7. The Requested Relief for the Current Funds are sub-advised by PIMCO. PIMCO has obtained the Requested Relief for a number of Canadian mutual funds it manages that currently hold Fannie and Freddie Securities with more than 10% of the mutual fund's net assets. As the investment sub-adviser to each Current Fund, PIMCO has experience in investing more than 10% of their net assets in Fannie and Freddie Securities and have utilized the Requested Relief in Canada to the benefit of their unit holders. PIMCO will use this experience to invest in Fannie and Freddie Securities in a similar manner.
8. The Fund may engage in securities lending, repurchase and reverse repurchase transactions, and use derivatives. These transactions and derivatives will be used in conjunction with the Fund's other investment strategies in a manner considered most appropriate to achieving the Fund's overall investment objectives and enhancing the Fund's returns as permitted by securities rules
9. Fannie Mae is a financial services corporation originally established by the United States Congress in 1938 to provide United States federal government money to local banks to finance home mortgages during the Great Depression. Its business includes borrowing money in the debt markets by selling bonds and providing liquidity to mortgage originators by purchasing whole loans which it then securitizes by issuing mortgage- backed securities. Fannie Mae also earns guarantee fees for assuming the credit risk on mortgage loans.
10. Freddie Mac is a financial services corporation that was created by the United States Congress in 1970 to expand the secondary market for mortgages in the United States. It was established to provide competition to Fannie Mae. Similar to Fannie Mae, the business of Freddie Mac includes buying mortgages in the secondary market, pooling them, and issuing mortgage-backed securities, as well as earning guarantee fees for assuming the credit risk on mortgage loans.
11. Fannie and Freddie Securities provide a substantial portion of the financing for residential mortgages in the United States.
12. Originally, the obligations of Fannie Mae were explicitly guaranteed by the United States government. The explicit guarantee was removed as part of a reorganization of Fannie Mae in 1968. Like Fannie Mae, there is no explicit guarantee of the obligations of Freddie Mac by the United States government.
13. Notwithstanding the absence of an explicit guarantee, it is widely assumed that there is an implied guarantee of the obligations of both Fannie Mae and Freddie Mac by the United States government. This assumption is based on the view that Fannie Mae and Freddie Mac each are considered to be "too big to fail" due to the critical roles they play as instrumentalities of the United States government existing to support the liquidity of the residential real estate mortgage market. Accordingly, it is widely believed that the United States government implicitly guarantees the obligations of Fannie Mae and Freddie Mac. This is reflected in Fannie and Freddie Securities currently having a U.S. Government Equivalent Rating.
14. The implied guarantee was evidenced during the 2008 financial crisis. At that time, Fannie Mae and Freddie Mac together owned or guaranteed approximately half of the United States' US$12 trillion mortgage market and were at risk of defaulting on their obligations. Such a default would have increased the cost of obtaining mortgage financing from other sources, thereby exacerbating the decline in the U.S. residential real estate market, as well as negatively impacting investors (including retirement funds and money market funds) that held Fannie and Freddie Securities. As a result, on September 7, 2008, Fannie Mae and Freddie Mac were placed into conservatorship of the United States Federal Housing Financing Agency in order to stabilize them. The United States government avoided creating an explicit guarantee of the obligations of Fannie Mae and Freddie Mac due to the negative impact it would have had on the United States Treasury. Fannie Mae and Freddie Mac were expressly excluded from the bail-in regime created under Title II of the United States Dodd-Frank Wall Street Reform and Consumer Protection Act to preclude future U.S. government bail-outs of large financial companies. It is expected that a further act of the U.S. Congress would be required to remove the implied guarantee of Fannie and Freddie Securities as part of a larger reform of the U.S. residential real estate market. No such initiative currently is a priority of the U.S. Congress.
15. Under the 1940 Act, an investment company registered with the United States Securities and Exchange Commission (the SEC) seeking to qualify as a "diversified company" is required, among other matters, to invest at least 75% of its total assets in a manner whereby not more than 5% of the value of its total assets is invested in the securities of any single issuer. This restriction is analogous to the diversification requirement imposed on public mutual funds in Canada by subsection 2.1(1) of NI 81-102 on public mutual funds in Canada. Similar to paragraph 2.1(2)(a) of NI 81-102, the 1940 Act excludes a "government security" from the 5% limit described.
16. The definition of "government security" in the 1940 Act differs from that contained in NI 81-102 by including any security issued by a person controlled or supervised by and acting as an instrumentality of the Government of the United States pursuant to authority granted by the Congress of the United States (a U.S. government instrumentality). Each of Fannie Mae and Freddie Mac is considered to be a U.S. government instrumentality and Fannie and Freddie Securities therefore are "government securities" under the 1940 Act.
17. The definition of "government security" in NI 81-102 does not include U.S. government instrumentalities. Accordingly, the only United States securities which qualify as government securities are those directly issued by, or fully and unconditionally guaranteed by, the United States government. Fannie and Freddie Securities do not meet this definition since their obligations are not explicitly fully and unconditionally guaranteed by the United States government.
18. As a result, the restriction in subsection 2.1(1) applies to each investment by a Fund in Fannie and Freddie Securities. Fannie and Freddie Securities represent a large, attractive and unique category of investment that cannot be replicated by any other issuer. For this reason, it is important to the Funds that they be entitled to maximize their opportunity to invest in Fannie and Freddie Securities.
19. Investments in Fannie and Freddie Securities are considered by PIMCO to be more prudent than investments in equivalent bonds and mortgage-backed securities of other issuers due to the implied guarantee by the United States government. Accordingly, if the Requested Relief is granted, each Fund will have the opportunity to maintain a more prudent portfolio through greater exposure to securities implicitly guaranteed by the United States government.
20. PIMCO has experience in investing client assets in Fannie and Freddie Securities and continuously researches and monitors the investment attributes and trading operations for Fannie and Freddie Securities. Such ongoing research and monitoring includes monitoring proposals to restructure the U.S. residential housing market that may impact the implied guarantee of Fannie and Freddie Securities by the U.S. government. If, the U.S. Congress proposes legislation to change or remove the implied guarantee and the Filer determines in its judgement that, as a result of the announced proposed legislation, there is a significant risk that the Fannie and Freddie Securities held by the Funds could cease to have a U.S. Government Equivalent Rating or their credit ratings could decline below a Minimum Rating, the Funds will take steps that are reasonably required to dispose of their Fannie and Freddie Securities in an orderly and timely fashion such that the Fannie and Freddie Securities held by the Fund comply with subsection 2.1(1) of NI 81-102.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator is that the Requested Relief is granted provided that:
(a) at the time of Purchase, the Fannie or Freddie Security has a U.S. Government Equivalent Rating and a rating not less than the Minimum Rating;
(b) the simplified prospectus and annual information form of each Fund:
(i) discloses that the Fund has received permission to invest more than 10% of its net assets in each of Fannie Mae and Freddie Mac provided the Fannie and Freddie Securities maintain a U.S. Government Equivalent Rating and a rating not less than the Minimum Rating;
(ii) discloses (in the case of a prospectus or simplified prospectus, under the heading or sub-heading "Investment Strategies") the maximum amount the Fund may invest in Fannie and Freddie Securities; and
(iii) the simplified prospectus contains risk factors that:
(A) the U.S. government may not guarantee payment of Fannie and Freddie Securities; and
(B) describe the risks associated with the Fund investing more than 10% of its net assets in securities of Fannie Mae or Freddie Mac,
provided that in the case of a Fund that is a mutual fund currently distributing its securities, the information required by this condition (b) may instead be included in the simplified prospectus of the Fund when it is next renewed or amended;
(c) if the rating of a Fannie or Freddie Security held by a Fund ceases to have a U.S. Government Equivalent Rating or declines below the Minimum Rating, the Fund will take the steps that are reasonably required to dispose of such Fannie or Freddie Security in an orderly and timely fashion such that the Fannie and Freddie Securities of such issuer held by the Fund comply with subsection 2.1(1) of NI 81-102; and
(d) if the U.S. Congress:
(i) proposes legislation intended to change or remove the implied guarantee by the U.S. government of Fannie Mae and/or Freddie Mac and the Filer determines in its judgement that, as a result of the announced proposed legislation, there is a significant risk that the Fannie and Freddie Securities held by the Funds could cease to have a U.S. Government Equivalent Rating or their credit ratings could decline below the Minimum Rating; or
(ii) enacts legislation that:
(A) removes the implied guarantee by the U.S. government of Fannie Mae and/or Freddie Mac; or
(B) specifies a future effective date on which the implied guarantee by the U.S. government of Fannie Mae and/or Freddie Mac will end,
the Funds will take the steps that are reasonably required to dispose of such Fannie and Freddie Securities in an orderly and timely fashion such that the Fannie and Freddie Securities held by the Funds comply with subsection 2.1(1) of NI 81-102.
I.G. Investment Management, Ltd.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- exemption from sections 2.8(1)(d) and 2.8(1)(f)(i) of National Instrument 81-102 -- Investment Funds to permit the Funds, when they open or maintain a long position in a standardized future or forward contract or when they enter into or maintain an interest rate swap position and during the periods when the Funds are entitled to receive payments under the swap, to use as cover, a right or obligation to sell an equivalent quantity of the underlying interest of the standardized future, forward or swap, subject to certain conditions.
National Instrument 81-102 Investment Funds, ss. 2.8(1)(d), 2.8(1)(f)(i), and 19.1.
September 22, 2020
The securities regulator authority in each of the Jurisdictions ("Decision Makers") has received an application from the Filer on behalf of all existing and future mutual funds managed by the Filer that are subject to National Instrument 81-102 Mutual Funds (NI 81-102), other than money market funds as defined in NI 81-102 (the Fund(s)), for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption, pursuant to section 19.1 of NI 81-102, from sections 2.8(1)(d) and 2.8(1)(f)(i) of NI 81-102 (the Exemption Sought), when:
(i) a Fund opens or maintains a long position in a debt-like security that has a component that is a long position in a forward contract or in a standardized future or forward contract; or
(ii) a Fund enters into or maintains a swap position and during the periods when the Fund is entitled to receive payments under the swap,
to permit each of the Funds to use as cover a right or obligation to sell an equivalent quantity of the underlying interest of the standardized future, forward or swap.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Manitoba Securities Commission is the principal regulator for this application;
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, the Northwest Territories, Nunavut and Yukon (the Other Jurisdictions); and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in NI 81-102, National Instrument 14-101 Definitions, and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation continued under the laws of Ontario. It is or will be the trustee, the portfolio advisor and the manager of the Funds. The head office of the Manager is in Winnipeg, Manitoba.
2. IGIM is registered as a Portfolio Manager and an Investment Fund Manager in Manitoba, Ontario, and Quebec and as an Investment Fund Manager in Newfoundland and Labrador.
The Funds
1. The Funds are mutual fund subject to NI 81-102, subject to any exemptions therefrom that have been, or may be, granted by the applicable securities' regulatory authorities, that has filed a simplified prospectus and annual information form prepared in accordance with National Instrument 81-101 -- Mutual Fund Prospectus Disclosure. The Funds are registered as a reporting issuer in each of the provinces and territories of Canada.
2. The Filer and the existing Funds are not in default of securities legislation in any of the provinces and territories of Canada.
Exemption Sought
1. Sections 2.8(1)(d) and 2.8(1)(f)(i) of NI 81-102 do not permit covering the position in long positions in standardized future and forward contracts or a position in a swap for a period when a Fund is entitled to receive payments under the swap, in whole or in part, with a right or obligation to sell an equivalent quantity of the underlying interest of the future, forward or swap. Accordingly, these sections of NI 81-102 do not permit the use of put options or short future, forward or swap positions to cover long future, forward or swap positions.
2. By not recognizing the hedging properties of options for long positions evidenced by standardized futures or forwards or in respect of swaps where a fund is entitled to receive payments from the counterparty, Regulation 81-102 effectively imposes the requirement to overcollateralize, since the maximum liability to the fund under the scenario described is equal to the difference between the market value of the long position and the exercise price of the option. Overcollateralization imposes a cost on a mutual fund.
3. Section 2.8(1)(c) of Regulation NI 81-102 permits a mutual fund to write a put option and to cover it by buying a right or obligation to sell an equivalent quantity of the underlying interest of the written put option. This position has similar risks as a debt-like security that has a component that has long position in a forward or a standardized future or forward contract as contemplated by paragraph 2.8(1)(d) or a swap as contemplated by subparagraph 2.8(1)(f)(i) and therefore, the Filer submits that the Funds should be permitted to cover a long position in a future, forward or swap with a put option or an offsetting short position.
4. The simplified prospectus and annual information form, upon renewal, will include disclosure of the nature of the Exemption Sought.
5. Without the Exemption Sought, the Funds will not have the flexibility to enhance yield and to manage more effectively any exposure they may have under specified derivatives.
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Maker under the Legislation is that the Exemption Sought is granted provided that:
(a) when a Fund enters into or maintains a swap position for periods when the Fund would be entitled to receive fixed payments under the swap, the Fund holds:
(i) cash cover in an amount that, together with margin on account for the swap and the market value of the swap, is not less than, on a daily mark-to-market basis, the underlying market exposure of the swap;
(ii) a right or obligation to enter into an offsetting swap on an equivalent quantity and with an equivalent term and cash cover that, together with margin on account for the position, is not less than the aggregate amount, if any, of the obligations of the Fund under the swap less the obligations of the Fund under such offsetting swap; or
(iii) a combination of the positions referred to in subparagraphs (i) and (ii) that is sufficient, without recourse to other assets of the Fund, to enable the Fund to satisfy its obligations under the swap;
(b) when a Fund opens or maintains a long position in a debt-like security that has a component that is a long position in a forward contract, or in a standardized future or forward contract, the Fund holds:
(i) cash cover in an amount that, together with margin on account for the specified derivative and the market value of the specified derivative, is not less than, on a daily mark-to-market basis, the underlying market exposure of the specified derivative;
(ii) a right or obligation to sell an equivalent quantity of the underlying interest of the future or forward contract, and cash cover that, together with margin on account for the position, is not less than the amount, if any, by which the market price of the future or forward contract exceeds the strike price of the right or obligation to sell the underlying interest; or
(iii) a combination of the positions referred to in subparagraphs (i) and (ii) that is sufficient, without recourse to other assets of the Fund, to enable the Fund to satisfy its obligations under the future or forward contract;
(c) a Fund will not (i) purchase a debt-like security that has an option component or an option; or (ii) purchase or write an option to cover any positions under section 2.8(1)(b), (c), (d), (e) or (f) of NI 81-102 if, immediately after the purchase or writing of such option, more than 10% of the net asset value of the Fund, taken at market value at the time of the transaction, would be in the form of (A) purchased debt-like securities that have an option component or purchased options, in each case, held by the Fund for purposes other than hedging, or (B) options used to cover any position under section 2.8(1)(b), (c), (d), (e) or (f) of NI 81-102;
(d) this decision will terminate on the coming into force of any securities legislation relating to the use as cover of a right or obligation to sell an equivalent quantity of the underlying interest of the standardized future, forward or swap in compliance with section 2.8 of NI 81-102.
Hamilton Capital Partners Inc. and Hamilton Canadian Bank 1.25x Leverage ETF
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- An alternative mutual fund that uses leverage to invest in a portfolio consisting of the six largest Canadian banks based on a factor index following a transparent methodology granted relief from the concentration restriction in NI 81-102, subject to conditions.
National Instrument 81-102 Investment Funds, ss. 2.1(1.1) and 19.1.
October 5, 2020
The principal regulator in Ontario has received an application from the Filer on behalf of the Fund for a decision under the securities legislation of Ontario (the Legislation) for exemptive relief (the Exemption Sought) relieving the Fund from subsection 2.1(1.1) of National Instrument 81-102 -- Investment Funds (NI 81-102), which prohibits an alternative mutual fund from purchasing a security of an issuer, entering into a specified derivatives transaction or purchasing an index participation unit if, immediately after the transaction, more than 20% of the net assets of the mutual fund, taken at market value at the time of the transaction, would be invested in securities of any issuer (the Concentration Restriction) to permit HCAL to replicate a 1.25 times multiple of the performance of a rules-based, variable-weight Canadian bank index (the Bank Index).
Under National Policy 11-203 -- Process for Exemptive Relief Applications in Multiple Jurisdictions (NP 11-203):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 -- Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Northwest Territories, Nunavut and Yukon (together with Ontario , the Jurisdictions).
Terms defined in National Instrument 14-101 -- Definitions, NI 81-102 or in MI 11-102 have the same meaning if used in this decision, unless otherwise defined herein.
The decision is based on the following facts represented by the Filer:
General
1. The Filer is a corporation organized under the laws of Ontario with a head office in Toronto.
2. The Filer will be the trustee, portfolio manager and investment fund manager of the Fund.
3. The Filer is not in default of securities legislation in any of the Jurisdictions.
4. The Filer is registered as: (i) an investment fund manager in Ontario, Quebec and Newfoundland & Labrador; (ii) an exempt market dealer in Ontario; and (iii) a portfolio manager in Ontario.
5. The Fund will be an exchange traded mutual fund trust governed by the laws of Ontario and a reporting issuer under the laws of the Jurisdictions.
6. The Fund will also be an "alternative mutual fund", as such term is defined in NI 81-102.
7. The Filer has filed a preliminary long form prospectus on behalf of the Fund with the securities regulatory authority in each of the Jurisdictions.
8. The Fund will be subject to NI 81-102, subject to any exemptions therefrom that may be granted by the securities regulatory authorities
9. The Fund will also be subject to National Instrument 81-107 Independent Review Committee for Investment Funds.
10. Units of the Fund will (subject to satisfying the Toronto Stock Exchange's (the TSX) original listing requirements) be listed on the TSX.
Hamilton Canadian Bank 1.25x Leverage ETF
11. The investment objective of the Fund will be to replicate, to the extent reasonably possible and before the deduction of fees and expenses, a multiple of the performance of a rules-based, variable-weight Canadian bank index. Specifically, the Fund will seek to replicate a 1.25 times multiple of the Solactive Canadian Bank Mean Reversion Index (or any successor thereto).
12. The Fund will use leverage in order to seek to achieve its investment objective. Leverage will be created through the use of cash borrowings or as otherwise permitted under applicable securities legislation for alternative mutual funds.
13. The constituent securities of the Bank Index are the top six Canadian banks listed on the Toronto Stock Exchange or other recognized exchange in Canada by market capitalization (theBanks and each a Bank). Currently, the constituents of the Bank Index are Bank of Montreal, The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada and The Toronto-Dominion Bank.
14. The Bank Index uses a rules-based mean reversion strategy. The Bank Index will rebalance the portfolio once a month (an Index Rebalance Date) based on the percent difference between each Bank's stock price and its 50-day average price. On an Index Rebalance Date: (i) the three Banks with the lowest percentage difference between their current trading price and their 50-day average price will be "over-weighted" at approximately 26.5% each of the Bank Index; and (ii) the three Banks with the highest percentage difference between their current trading price and their 50-day average price will be "under-weighted" at approximately 6.5% each of the Bank Index. Such portfolio weightings will be maintained until the next Index Rebalance Date, at which point the rebalancing process is repeated.
15. HCAL will seek to achieve its investment objective by borrowing cash to invest in and hold a proportionate share of, or a sampling of the constituent securities of, the Bank Index in order to track approximately 1.25x the performance of the Bank Index. As an alternative to, or in conjunction with investing in and holding the constituent securities, HCAL may also invest in other securities, including other mutual funds or exchange traded funds to obtain exposure to the constituent securities of the Bank Index in a manner that is consistent with HCAL's investment objective. HCAL may also hold cash and cash equivalents or other money market instruments in order to meet its obligations.
16. The maximum aggregate exposure of the Fund to cash borrowing, short selling and specified derivatives will not exceed approximately 125% of its net asset value (NAV).
17. In order to ensure that a unitholder's risk is limited to the capital invested, the Fund's leverage ratio will rebalanced in certain circumstances and when the leverage ratio breaches certain bands. Specifically, the Fund's leverage will be rebalanced back to 125% of the Fund's NAV within two business days (a Leverage Rebalance Date and together with an Index Rebalance Date, a Rebalance Date) of the Fund's leverage ratio moving 2% away from its target leverage ratio of 125% (i.e., if the leverage ratio is less than 123% or if the leverage ratio is greater than 127%).
18. Following a Rebalance Date, the Fund will generally acquire and/or dispose of the appropriate number of securities in order to track the stated, approximate, multiple of the portfolio weighting of the Bank Index. As a result: (i) units of the Fund may be issued, or cash may be paid, in consideration for constituent securities making up the Bank Index and to be acquired by the Fund, as determined by its portfolio adviser; and (ii) units may be exchanged in consideration for those securities that the portfolio adviser determines should be sold by the Fund, or cash may be paid as determined by the portfolio adviser. Generally, such transactions may be implemented by a transfer of constituent securities to the Fund that the portfolio adviser determines should be acquired by the Fund or a transfer of those securities that the portfolio adviser determines should be sold by the Fund.
19. Outside of a Rebalance Date, any investments by the Fund (owing, for example, to subscriptions received in respect of Units of the Fund), if any, will be such that securities are acquired up to the same weights as such securities exist in the Fund's portfolio, based on their relative market values, at the time of such investment.
20. On a leveraged basis, the Fund may therefore invest up to approximately: (i) 33.3% of its NAV in a Bank security that is over-weighted in the Bank Index; and (ii) 8.3% of its NAV in a Bank security that is underweighted in the Bank Index.
21. In order to achieve its investment objective, and based on the proposed investment strategy, HCAL therefore wishes to be able to invest in a portfolio of Banks, such that immediately after a purchase, more than 20% of HCAL's NAV may be invested in any one Bank for the purposes of determining compliance with the Concentration Restriction.
22. The investment objective and investment strategy of HCAL, as well as the risk factors associated therewith, including concentration risk, will be disclosed in the prospectus of HCAL, as may be renewed or amended from time to time. The names of the Banks will also be disclosed in the prospectus of HCAL, as may be renewed or amended from time to time.
23. The common shares of the Banks are listed on the TSX.
24. The Banks are among the largest public issuers in Canada.
Rationale for Investment
25. The Filer notes that, in respect of the Fund, its strategy to acquire securities of an applicable Bank will be transparent, passive and fully disclosed to investors. The Fund will not invest in securities other than Bank securities (or securities designed to gain exposure to the Bank securities as described herein). In addition, in respect of the Fund, the names of the Banks to be invested in will be listed in the Fund's prospectus. Consequently, unitholders of the Fund will be fully aware of the risks involved with an investment in the securities of the Fund.
26. Given the proposed composition of the Fund's portfolio, it would be impossible for the Fund to achieve its investment objective and pursue its investment strategy without obtaining relief from the Concentration Restriction.
27. The units of the Fund will be highly liquid securities, as designated brokers act as intermediaries between investors and the Fund, standing in the market with bid and ask prices for the units of the Fund to maintain a liquid market for the units of the Fund. The majority of trading in units of the Fund will occur in the secondary market.
28. If required to facilitate distributions or pay expenses of the Fund, securities of the Bank securities will be sold pro-rata across the Fund's portfolio according to their relative market values at the time of such sale.
29. Future subscriptions for Fund securities, if any, will be used to acquire securities of each Bank up to the same weights as the Bank securities exist in the Fund's portfolio, based on their relative market values at the time of such subscription.
30. In view of the Filer, the Fund is also akin to a "fixed portfolio investment fund", as such term is defined in NI 81-102, in that it will: (a) have fundamental investment objectives that include holding and maintaining a fixed portfolio of publicly traded equity securities of one or more issuers, the names of which are disclosed in its prospectus; and (b) trade the securities referred to in paragraph (a) only in the circumstances disclosed in its prospectus. The Fund will not be a "fixed portfolio investment fund" as it is an alternative mutual fund and will be in continuous distribution.
31. The Filer further notes that a "fixed portfolio investment fund" is exempt from the Concentration Restrictions, provided purchases of securities are made in accordance with its investment objectives.
32. With respect to the Banks, the Banks are among the largest public issuers in Canada. The common shares of the Banks are some of the most liquid equity securities listed on the TSX and are less likely to be subject to liquidity concerns than the securities of other issuers.
33. The liquidity of the common shares of the Banks is evidenced by the markets for options in connection therewith. A liquid market for options on the common shares of the Banks is provided by the Montreal Exchange.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator is that the Exemption Sought is granted for so long as:
(a) the investment in a Bank is made in accordance with HCAL's investment objectives and investment strategies to replicate a 1.25 times multiple of the performance of the Bank Index;
(b) HCAL's investment strategies disclose that, as of a Rebalance Date, HCAL will invest in the Banks up to the stated maximum percentages described at representation 20, above. Outside of a Rebalance Date, any investments by HCAL, if any, will be such that securities of each Bank are acquired up to the same weights as the Bank securities exist in HCAL's portfolio, based on their relative market values at the time of such investment;
(c) HCAL's investment strategies disclose that HCAL's portfolio will be rebalanced as of each Rebalance Date; and
(d) HCAL includes in its final prospectus: (i) disclosure regarding the Exemption Sought under the heading "Exemptions and Approvals"; and (ii) a risk factor regarding the concentration of HCAL's investments in the Banks and the risks associated therewith.
File No. 2020-16
October 1, 2020
WHEREAS on October 1, 2020, the Ontario Securities Commission held a hearing by teleconference;
ON HEARING the submissions of the representatives for Staff of the Commission (Staff) and for Aurelio Marrone (Marrone);
IT IS ORDERED THAT:
1. Marrone shall file and serve a witness list, and serve a summary of each witness's anticipated evidence on Staff, and indicate any intention to call an expert witness, by no later than November 2, 2020; and
2. an attendance in this matter is scheduled for November 30, 2020 at 9:00 a.m., by teleconference, or on such other date and time as may be agreed to by the parties and set by the Office of the Secretary.
File No. 2019-16
October 1, 2020
WHEREAS on September 30, 2020, the Ontario Securities Commission (the Commission) held a hearing by videoconference;
ON HEARING the submissions of the representatives for Joseph Debus (Debus), Staff of the Investment Industry Regulatory Organization of Canada (IIROC) and Staff of the Commission;
IT IS ORDERED that:
1. by no later than October 16, 2020, Debus shall advise via email to the Registrar, copying all parties, whether
(a) he intends to rely on documents or things not included in the record of the original proceeding that he previously gave notice of intention to rely on and disclosed, and, if so, identify them;
(b) he intends to call any of the witnesses he identified on his witness list and for whom he provided witness summaries, and if so, identify which witnesses he intends to call;
2. if IIROC or Commission Staff wish to object to Debus relying on documents or things not included in the record of the original proceeding and/or the anticipated evidence of the witnesses Debus intends to call, then that motion shall be heard in writing, and the schedule for the motion shall be as follows,
(a) by no later than November 6, 2020, each moving party shall serve and file a motion, motion record, if any, and a memorandum of fact and law;
(b) by no later than November 13, 2020, Debus shall serve and file responding affidavits, if any, and a responding memorandum of fact and law;
(c) by no later than November 16, 2020, each moving party shall serve and file a reply memorandum of fact and law, if any;
3. by no later than January 20, 2021, Debus shall serve and file reply written submissions for the Application for Hearing and Review, if any; and
4. the hearing of the Application for Hearing and Review will be held by videoconference on January 27, 2021 and shall continue on January 28, 2021, commencing at 10:00 a.m. on each scheduled day, or on such other dates or times as may be agreed to by the parties and set by the Office of the Secretary. These dates are peremptory on Mr. Debus.
Temporary, Permanent & Rescinding Issuer Cease Trading Orders
Company Name |
Date of Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Revoke |
|
||||
THERE IS NOTHING TO REPORT THIS WEEK. |
||||
Company Name |
Date of Order |
Date of Revocation |
|
||
Hello Pal International Inc. |
September 21, 2020 |
October 1, 2020 |
|
||
Hi Ho Silver Resources Inc. |
January 30, 2020 |
October 5, 2020 |
|
||
Lendified Holdings Inc. |
July 9, 2020 |
October 1, 2020 |
Temporary, Permanent & Rescinding Management Cease Trading Orders
Company Name |
Date of Order |
Date of Lapse |
|
||
Mountain Valley MD Holdings Inc. |
September 17, 2020 |
October 1, 2020 |
|
||
Sproutly Canada, Inc. |
September 16, 2020 |
September 30, 2020 |
Outstanding Management & Insider Cease Trading Orders
Company Name |
Date of Order or Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/ Expire |
Date of Issuer Temporary Order |
Performance Sports Group Ltd. |
19 October 2016 |
31 October 2016 |
31 October 2016 |
__________ |
__________ |
Company Name |
Date of Order |
Date of Lapse |
|
||
Agrios Global Holdings Ltd. |
September 17, 2020 |
__________ |
|
||
Mountain Valley MD Holdings Inc. |
September 17, 2020 |
October 1, 2020 |
|
||
Sproutly Canada, Inc. |
September 16, 2020 |
September 30, 2020 |
Issuer Name:
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Project #3103564
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Project #3100973
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Project #3099165
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Project #3092476
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Project #2972290
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Project #3083340
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Project #3062111
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Project #3038258
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Project #3057455
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Project #3072711
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Project #3118281
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Project #3120300
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Project #3118800
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Project #3118800
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Project #3117908
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Project #3117936
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Project #3117923
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Project #3117931
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Project #3117910
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Project #3117913
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Project #3117941
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Project #3120206
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Project #3120307
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Project #3120003
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Project #3119108
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Project #3118180
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Project #3118685
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Project #3119650
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Project #3119848
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Project #3118197
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Project #3117497
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Project #3118998
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Project #3080982
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Project #3055756
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Project #3049970
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Project #3073713
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Project #3116733
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Project #3113698
Type |
Company |
Category of Registration |
Effective Date |
|
|||
Voluntary Surrender |
Responsive Capital Management Inc. |
Portfolio Manager |
September 29, 2020 |
|
|||
Consent to Suspension (Pending Surrender) |
Surepath Capital Partners Inc. |
Exempt Market Dealer |
September 29, 2020 |
|
|||
Voluntary Surrender |
Michael Graham Investment Services Inc. |
Portfolio Manager |
September 29, 2020 |
|
|||
New Registration |
Hyperion Capital Inc. |
Exempt Market Dealer |
October 2, 2020 |
Investment Industry Regulatory Organization of Canada (IIROC) -- Notice of Proposed Amendments Respecting the Trading of Derivatives on a Marketplace -- Request for Comment
IIROC is publishing for public comment proposed amendments (Proposed Amendments) to the Universal Market Integrity Rules and the Dealer Member Rules / IIROC Rules that would regulate the trading of listed derivatives on a marketplace for which IIROC acts as the regulation services provider.
The main objective of the Proposed Amendments is to provide a framework for the regulation of listed derivatives trading on a marketplace that strengthens market integrity and investor protection. The Proposed Amendments:
• expand, where appropriate, the scope of certain current securities trading requirements to apply to derivatives trading
• limit, where appropriate, certain current requirements to apply only to securities trading
• introduce new requirements that are specific to derivatives trading.
A copy of the IIROC Notice, including the text of the Proposed Amendments, is also published on our website at www.osc.gov.on.ca. The comment period ends on December 7, 2020.
Investment Industry Regulatory Organization of Canada (IIROC) -- Proposed Amendments Regarding Exemptions for Bulk Account Movements -- Request for Comment
IIROC is publishing for public comment proposed amendments to Dealer Member Rule 2300 and IIROC Rule 4800 relating to bulk account movements ("Proposed Amendments"). The main purpose of the Proposed Amendments is to set out in the rules the authority of IIROC Staff to grant exemptive relief to Dealer Members from the obligation to complete certain account documentation requirements within the applicable timeline in bulk account movement situations.
IIROC anticipates that the Proposed Amendments will add clarity to Dealer Members, their clients and other stakeholders and enable IIROC to grant exemptive relief for bulk account movements in an efficient manner, limiting unnecessary delays of planned transactions. IIROC will exercise such an exemptive authority in consideration of the interest of clients, the public and Dealer Members and will impose any terms and conditions it deems necessary given the particularities of each transaction.
A copy of the IIROC Notice including the text of the Proposed Amendments is also published on our website at http://www.osc.gov.on.ca. The comment period ends on December 7, 2020.
CDS Clearing and Depository Services Inc. -- Material Amendments to CDS External Procedures -- Interest Charges
In accordance with the Rule Protocol between the Ontario Securities Commission (Commission) and CDS Clearing and Depository Services Inc. (CDS), the Commission approved on September 23, 2020 Material Amendments to CDS External Procedures related to interest charges.
A copy of the CDS notice was published for comment on July 16, 2020 on the Commission's website at: http://www.osc.gov.on.ca. No comments were received.