BOR 97/04 - Trust Companies, Insurers and Portfolio Managers in Other Provinces and Territories of Canada and Foreign Portfolio Managers [Rescinded]

IN THE MATTER OF THE SECURITIES ACT S.B.C. 1985, c. 83

AND

IN THE MATTER OF TRUST COMPANIES, INSURERS AND PORTFOLIO MANAGERS IN OTHER PROVINCES AND TERRITORIES OF CANADA AND FOREIGN PORTFOLIO MANAGERS

Order Under Sections 33 and 59

WHEREAS sections 29(1) and 55(1) of the Securities Act, S.B.C. 1985, c. 83 (the "Act") deem that, for purposes of Part 5 and section 55 of the Act,

(a) a trust company or an insurer is acting as principal when it purchases or sells as an agent or trustee for accounts that are fully managed by it, and

(b) a portfolio manager is acting as principal when it purchases or sells as an agent for accounts that are fully managed by it;

AND WHEREAS under sections 31(2)(5) and 55(2)(4) of the Act, and sections 89(a), 89(b), 128(a) and 128(b) of the Securities Rules, B.C. Reg. 479/95 (the "Rules"), sections 20 and 42 of the Act do not apply to a trade where a person purchases as principal and the trade otherwise complies with the requirements of those sections;

AND WHEREAS under section 29 of the Interpretation Act, R.S.B.C. 1979, c. 206, a trust company and an insurance company are defined as a trust company and insurance company authorized to carry on business in British Columbia under the Financial Institutions Act, S.B.C. 1989, c. 47;

AND WHEREAS the Commission considers that "portfolio manager" in sections 29(1) and 55(1) of the Act means a portfolio manager that carries on business in British Columbia and is registered or exempted from registration under the Act;

AND WHEREAS a trust company, insurer or portfolio manager authorized to carry on business in a jurisdiction other than British Columbia would not be deemed under sections 29(1) and 55(1) of the Act to be acting as principal when purchasing for fully managed accounts;

AND WHEREAS it would be expedient to provide registration and prospectus exemptions parallel to those in sections 31(2)(5) and 55(2)(4) of the Act and sections 89(a), 89(b), 128(a) and 128(b) of the Rules where the purchaser is a trust company or insurer authorized to carry on business, or a portfolio manager registered or exempted from registration, in a province or territory of Canada other than British Columbia, or where the purchaser carries on business as a portfolio manager in a jurisdiction other than Canada, provided certain requirements are met;

AND WHEREAS the Commission considers that to do so would not be prejudicial to the public interest;

IT IS ORDERED:

1. under sections 33 and 59 of the Act that sections 20 and 42 of the Act do not apply to a trade in a security where
   
   (a) a trust company or an insurer, authorized under the laws of a province or territory of Canada other than British Columbia to carry on business in that province or territory, purchases, as an agent or trustee for accounts that are fully managed by it, or
   
   (b) a portfolio manager, registered or exempted from registration as a portfolio manager under the laws of a province or territory of Canada other than British Columbia, purchases, as an agent for accounts that are fully managed by the portfolio manager,
   
   a security
   
   (c) that has an aggregate acquisition cost of not less than $97,000, or
   
   (d) in the circumstances set out in sections 89(a)(i), (ii), (iii), (v) and (vi), and 128(a)(i), (ii), (iii), (v) and (vi) of the Rules, or
   
   (e) in the circumstances set out in sections 89(b)(ii), (iii) and (iv), and 128(b)(ii), (iii) and (iv) of the Rules;
   
2. under sections 33 and 59 of the Act that sections 20 and 42 of the Act do not apply to a trade in a security where a person that carries on business as a portfolio manager in a jurisdiction other than Canada purchases, as an agent for accounts that are fully managed by the person, a security
   
   (a) that has an aggregate acquisition cost of not less than $97,000, or
   
   (b) in the circumstances set out in sections 89(a)(i), (ii), (iii), (v) and (vi), and 128(a)(i), (ii), (iii), (v) and (vi) of the Rules, or
   
   (c) in the circumstances set out in sections 89(b)(ii), (iii) and (iv), and 128(b)(ii), (iii) and (iv) of the Rules,
   
   provided that
   
   (d) the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000, and
   
   (e) the Form attached to this Order as Schedule "A" or the Vancouver Stock Exchange form entitled "Private Placement Questionnaire and Undertaking" is filed on or before the 10th day after the distribution; and
   
3. under section 59 of the Act that a trade in a security acquired under this Order is deemed to be a distribution unless the resale requirements in sections 140, 142 and 143 of the Rules that would have been applicable had the security been acquired under section 55(2)(4) of the Act, or sections 128(a) or 128(b) of the Rules, have been complied with.

DATED at Vancouver, British Columbia, on March 4, 1997.

Schedule "A"

Certification by Foreign Portfolio Manager

The undersigned is purchasing securities of _______________________ (the "Issuer").

The undersigned hereby certifies that:

(a) it is purchasing securities of the Issuer on behalf of managed accounts over which it has absolute discretion as to purchasing and selling, and in respect of which it receives no instructions from any person beneficially interested in such accounts or from any other person;

(b) it carries on the business of managing the investment portfolios of clients through discretionary authority granted by those clients (a "portfolio manager" business) in _______________________ [jurisdiction], and it is permitted by law to carry on a portfolio manager business in that jurisdiction;

(c) it was not created solely or primarily for the purpose of purchasing securities of the Issuer;

(d) the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000;

(e) it does not believe, and has no reasonable grounds to believe, that any resident of British Columbia has a beneficial interest in any of the managed accounts for which it is purchasing; and

(f) the Issuer has provided it with a list of the directors, senior officers and other insiders of the Issuer, and the persons that carry on investor relations activities for the Issuer (which list is attached as a schedule to this Form), and it does not believe, and has no reasonable grounds to believe, that any of those persons has a beneficial interest in any of the managed accounts for which it is purchasing, except as follows:

__________________________________________

 

__________________________________________

(name of insider(s) or person(s) carrying on investor
relations activities for the Issuer that have a beneficial
interest in an account)

The undersigned acknowledges that it is bound by the provisions of the British Columbia Securities Act including, without limitation, sections 70 and 93 concerning the filing of insider reports and reports of acquisitions.

Dated at ____________________________

this _____ day of _______________ 19 __

___________________________________
(Name of Purchaser - please print)

___________________________________
(Authorized Signature)

___________________________________
(Official Capacity - please print)

____________________________________
(please print name of individual whose signature appears above, if different from name of purchaser printed above)