ABN AMRO Asset Management Canada Limited - MRRS Decision
Headnote
Mutual Reliance Review System for Exemptive Relief Applications -- relief from requirement to obtain specific and informed written consent from discretionary management clients once in each twelve-month period with respect to certain funds -- subject to conditions.
Applicable Ontario Legislation
Ontario Regulation 1015, R.R.O. 1990, ss. 227(2)(b), 233.
May 30, 2006
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
ONTARIO, ALBERTA AND NEW BRUNSWICK
(the Jurisdictions)
AND
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF
ABN AMRO ASSET MANAGEMENT CANADA
LIMITED (the Filer)
MRRS DECISION DOCUMENT
Background
The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption from the requirement that a registrant acting as an adviser and exercising discretionary authority with respect to the investment portfolio or account of a client (in each case, a Client) not purchase or sell securities of a related issuer, or in the course of an initial distribution or a distribution (depending on the Jurisdiction) securities of a connected issuer, to invest in securities of funds managed, or to be managed, by the Filer or an associate or affiliate of the Filer (collectively the Funds), unless once in each twelve month period it provides the Client a copy of its Statement of Policies and obtains the specific and informed written consent of the Client (the Requested Relief).
Under the Mutual Reliance Review System for Exemptive Relief Applications:
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) this MRRS decision document evidences the decision of each Decision Maker.
Interpretation
Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this decision.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is a corporation formed under the laws of the Province of Ontario and has its head office in Toronto. The Filer is registered as an adviser in each of Ontario, Alberta, British Columbia, New Brunswick and Quebec.
2. The Filer manages its Client's assets on a discretionary basis and may trade in securities of one or more Funds governed by National Instrument 81-102 - Mutual Funds, or in the securities of one or more pooled Funds for its Clients' accounts. Discretionary management Clients of the Filer enter into a discretionary investment management agreement (the Managed Account Agreement) with the Filer.
3. Each discretionary management Client of the Filer will receive specific disclosure of the relationship between the Filer and the applicable Funds.
4. Each discretionary management Client of the Filer will specifically consent to the Filer exercising its discretion under the Managed Account Agreement to buy and sell securities of the Funds.
5. The Funds are generally connected issuers of the Filer within the meaning of securities rules or instruments and it is possible that a new Fund may be a related issuer of the Filer for a period of time until the Filer ceases to hold more than 20% of the units of the Fund.
6. All discretionary management Clients of the Filer receive an initial copy of the Statement of Policies of the Filer when they enter into a Managed Account Agreement with the Filer, which includes a conflicts statement listing the related and connected issuers of the Filer. In the event of a significant change in its Statement of Policies, the Filer will provide to each of its Clients a copy of the revised version of, or amendment to, the Statement of Policies.
Decision
Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the Decision has been met.
The decision of the Decision Makers pursuant to the Legislation is that the Requested Relief is granted, provided that the Filer has provided an initial copy of the Filer's Statement of Policies, and has secured the specific and informed consent of the discretionary management Client in advance of the exercise of discretionary authority to invest in the applicable Funds.