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Securities Law

BOR 92/02 - The Limitations on a Registrant Underwriting Securities of a Related Party or Connected Party of the Registrant [Rescinded]

Published Date: 1992-08-07
Effective Date: 1992-08-06
Rescinded Date: 2001-06-27

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

IN THE MATTER OF THE LIMITATIONS ON A REGISTRANT UNDERWRITING SECURITIES OF A RELATED PARTY OR CONNECTED PARTY OF THE REGISTRANT

Order Under Section 167.12 of the Regulation

WHEREAS section 167.4 of the Securities Regulation, B.C. Reg. 270/86 (the "Regulation") imposes limitations on a registrant acting as an underwriter or special selling group member in connection with an initial distribution of securities issued by the registrant or issued by or held by a related party or connected party of the registrant;

AND WHEREAS, except in the circumstances described in section 167.4(2)(c), (4) or (5) of the Regulation, section 167.4(2)(b) of the Regulation requires that in the case of an initial distribution made under a prospectus or under a statement of material facts, the portion of the initial distribution underwritten by at least one independent underwriter is not less than the aggregate of the portions of the initial distribution underwritten by or, in the capacity of special selling group member, sold by the registrant and each other registrant in respect of which the issuer is a related party or a connected party;

AND WHEREAS the Superintendent of Brokers (the "Superintendent") has concluded that the requirement in section 167.4(2)(b) of the Regulation is not necessary to protect investors and, if the requirement were enforced, it would unduly disrupt industry practice and issuer's needs;

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

IT IS ORDERED under section 167.12 of the Regulation that section 167.4(2)(b) does not apply to a registrant acting as an underwriter or special selling group member in connection with an initial distribution, made under a prospectus or under a statement of material facts, of securities issued by or held by a related party or connected party of the registrant provided that

1. the aggregate of the portions of the initial distribution underwritten by the independent underwriters is not less than the aggregate of the portions of the initial distribution underwritten by or, in the capacity of special selling group member, sold by the registrant and each other registrant in respect of which the issuer is a related party or a connected party,

2. the portion of the initial distribution underwritten by at least one of the independent underwriters is not less than the largest portion of the initial distribution underwritten by or, in the capacity of special selling group member, sold by a registrant in respect of which the issuer is a related party or a connected party, and

3. each independent underwriter signs the prospectus certificate or the statement of material facts certificate required by section 50 of the Securities Act, S.B.C. 1985, c. 83 and section 122 of the Regulation, respectively.

DATED at Vancouver, British Columbia, on August 6, 1992.

Wade D. Nesmith
Superintendent of Brokers