Commission Notice: OSC Notice - 48-701 - Lapse of SEC No-Action Letter Regarding U.S. Trading Rules and MJDS Transactions

OSC NOTICE 48 - 701 - NOTICE OF LAPSE OF SEC NO-ACTION
LETTER REGARDING US TRADING RULES AND MJDSTRANSACTIONS

An exemption letter was received by the Ontario Securities Commission (the "OSC") andCommission des Valeurs Mobilieres du Quebec (the "CVMQ") dated August 22, 1991 (SEC FileNumber TP91-10) ("1991 Exemption Letter") from the U.S. Securities and ExchangeCommission (the"SEC"), regarding the application of certain SEC trading practices rules todistributions of certain Canadian securities pursuant to the Multijurisdictional Disclosure System("MJDS"), a reciprocal arrangement between the SEC and the jurisdictions of the CanadianSecurities Administrators.

The SEC recently adopted a new Regulation M which replaced rules 10b-6, 10b-7 and 10b-8 (thesubject matter of the 1991 Exemption Letter). See SEC Release No. 33-7375, 37-38067(December 23, 1996). The December 20, 1996 release of the final rules regarding Regulation Mindicated that the Exemption granted under the prior rules will no longer be in effect as of theeffective date of Regulation M which was March 4, 1997. The final release further suggestedthat if a recipient of an exemption or no-action letter issued under the former trading practicesrules believes that the relief granted by such letter continues to be necessary under Regulation M,that party may wish to contact the Office of Risk Management and Control, the SEC Division ofMarket Regulation.

Although the OSC and CVMQ are currently considering on what terms to make a request for anExemption letter regarding the application of Regulation M with respect to certain marketactivities effected during distributions under MJDS transactions, market participants should beaware that they cannot rely on the 1991 Exemption Letter and should consider whether and howRegulation M applies to those transactions.

June 27, 1997

Reference:
Randee B. Pavalow
Policy Coordinator
Ontario Securities Commission
(416) 593 - 8257
Daniel Laurion
Deputy Director of Regulation and Policy
Commission des Valeurs Mobilieres du Quebec
(514) 873 - 5009 Ext. 266