Securities Law

32-505 - Exemption for Mutual Fund Dealers to Sell Securities of Certain Employee Venture Capital Corporations and Venture Capital Corporations [BCI - Rescinded]

Published Date: 2003-10-02
Effective Date: 2003-09-30
Rescinded Date: 2009-09-28

British Columbia Securities Commission

 

BC Instrument 32-505

 

The British Columbia Securities Commission, having considered it to be in the public interest, orders that the attached BC Instrument 32-505 entitled “Exemption for Mutual Fund Dealers to Sell Securities of Certain Employee Venture Capital Corporations and Venture Capital Corporations” is made.

 

 

September 30, 2003

 

 

 

 

Douglas M. Hyndman

Chair

 

 

________________________________________________________________               

(This part is for administrative purposes only and is not part of the Order)

 

Authority under which Order is made:

Act and sections: 187

Other (specify):-

 


BC Instrument 32-505

 

Exemption for Mutual Fund Dealers to Sell Securities

of Certain Employee Venture Capital Corporations and
Venture Capital Corporations

 

Order under section 187 of theSecurities Act

 

Definitions

1.   In this Instrument:

 

“dealer” means a registered dealer who is a member of the Mutual Fund Dealers Association of Canada;

 

“employee venture capital corporation” means an employee venture capital corporation registered under Part 2 of the Employee Investment Act;

 

“responsible individual” means a registered trading partner, director or officer assigned by the dealer to review trades made under this exemption;

 

“salesperson” means an individual registered under the Act as a salesperson of a dealer;

 

“venture capital corporation” means a venture capital corporation registered under Part 1 of the Small Business Venture Capital Act whose business objective is making and managing multiple investments;

 

Exemption

2.   Section 6(2)(c)(ii)(B) of the Securities Rules does not apply to a dealer when trading in a security issued by an employee venture capital corporation or a venture capital corporation, provided

(a) the issuer of the security has filed, and obtained a receipt for, a preliminary prospectus and a prospectus respecting the security,

(b) the issuer of the security is a reporting issuer,

(c) if the trade takes place on or before March 1, 2004, either

(i)  the aggregate acquisition cost of the trade to the purchaser is not more than $15,000 and the responsible individual reviews the trade to ensure that it is suitable for the purchaser, or

(ii) the responsible individual has:

(A) reviewed the trade prior to its completion to ensure that the investment in the security is suitable for the purchaser, and

(B) documented his or her review and conclusion, and

(d) if the trade takes place after March 1, 2004, the salesperson and the responsible individual have successfully completed either

(i)  the Canadian Securities Course, or

(ii) the Labour Sponsored Investment Funds Course offered by The Investment Funds Institute of Canada.

 

Notice

3.   The first time a dealer intends to rely on this exemption, the dealer must notify the Commission prior to the first trade.

 

4.   After filing an initial notice of intention to rely on the exemption, if the dealer intends to continue to rely on this exemption, the dealer must file a notice annually within ninety days of the dealer’s financial year end. 

 

5.   Each notice must be sent to the Director, Capital Markets Regulation.