BOR 90/04 - Trades in Deposit-Type or Self-Directed Registered Educational Savings Plans [Rescinded]

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

IN THE MATTER OF TRADES IN DEPOSIT-TYPE OR SELF-DIRECTED REGISTERED EDUCATIONAL SAVINGS PLANS

Exemption Order under Sections 33 and 59

WHEREAS section 1(1) of the Securities Act, S.B.C. 1989, c. 83 (the "Act") defines a security to include "a document evidencing an interest in a scholarship or educational plan or trust";

AND WHEREAS an educational savings plan registered under the Income Tax Act (Canada) (the "ITA") (a "RESP") issues a document evidencing an interest in the RESP to a person who subscribes for an interest in the RESP (the "subscriber");

AND WHEREAS contributions by a subscriber to a deposit-type or self-directed RESP are not pooled with the funds of other subscribers but are either deposited directly in an account in the subscriber's name or used, at the subscriber's sole discretion, to purchase other investments as may be permitted under applicable law;

AND WHEREAS the subscriber maintains control and direction over the subscriber's RESP, directing the manner in which the assets of the subscriber's RESP are to be held, invested or reinvested;

AND WHEREAS the subscriber's control and direction over the subscriber's RESP parallels the control and direction exercised by a person subscribing to a self-directed registered retirement savings plan ("RRSP"), which RRSP is not subject to the registration and prospectus requirements of the Act;

AND WHEREAS prior to February 20, 1990, the ITA required a RESP to file a prospectus with a securities regulatory authority in Canada;

AND WHEREAS the most recent federal budget has proposed that, effective February 20, 1990, a RESP not be required to file a prospectus with a securities regulatory authority in Canada in order to be registered under the ITA where the RESP is not required to file a prospectus under applicable securities law;

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

IT IS ORDERED under sections 33 and 59 of the Act that sections 20 and 42 of the Act do not apply to a trade in a RESP to a subscriber, provided that the contributions by the subscriber are not pooled with the funds of other subscribers but are either deposited directly in an account in the subscriber's name or used, at the subscriber's sole discretion, to purchase other investments as may be permitted under applicable law.  

DATED at Vancouver, British Columbia, this 11th day of October 1990.

Douglas M. Hyndman
Chairman