Aspect Capital Limited - s. 80 of the CFA

Headnote

Section 80 of the Commodity Futures Act (Ontario) (the CFA) - Relief from the adviser registration requirement of paragraph 22(1)(b) of the CFA granted to a non-resident adviser in respect of advising certain non-Canadian mutual funds regarding trades in commodity futures contracts and commodity futures options traded on commodity futures exchanges primarily outside of Canada and cleared through clearing corporations primarily outside of Canada, subject to certain terms and conditions.

Statutes Cited

Commodity Futures Act, R.S.O. 1990, c. C.20, as am., s. 22(1)(b) and s. 80.

Securities Act, R.S.O. 1990, c. S.5, as am. -- Rule 35-502 -- Non Resident Advisers.

IN THE MATTER OF

THE COMMODITY FUTURES ACT

R.S.O. 1990, CHAPTER C.20, AS AMENDED (the "ACT")

AND

IN THE MATTER OF

ASPECT CAPITAL LIMITED

ORDER

(Section 80 of the Act)

UPON the application of Aspect Capital Limited (the "Applicant") to the Ontario Securities Commission (the "Commission") for an order pursuant to section 80 of the Act that the Applicant and its directors, officers and employees are exempt from the requirements of paragraph 22(1)(b) of the Act in respect of advising Aspect Diversified Fund, Aspect Currency Fund Limited, Aspect Master Fund Limited, Aspect European Equity Fund Limited, Aspect European Market Neutral Fund Limited, Aspect Japanese Equity Fund Limited and Aspect Trading Fund Limited (collectively the "Funds") in respect of trades in commodity futures contracts and options traded on commodity futures exchanges located primarily outside of Canada and cleared through clearing corporations located primarily outside of Canada (the "Proposed Advisory Business");

AND UPON considering the application and the recommendation of staff of the Commission;

AND UPON the Applicant having represented to the Commission as follows:

1. The Applicant is a limited liability company organized under the laws of England and regulated in the conduct of its business in the United Kingdom by the Financial Services Authority of the United Kingdom.

2. The Applicant is the investment manager of each of the Funds and is responsible for managing the assets and investments of the Funds in accordance with their respective investment objectives, policies and restrictions.

3. The Funds are permitted to invest in commodity futures and options contracts and other derivative instruments traded on recognized exchanges located primarily outside of Canada and cleared through clearing corporations located primarily outside of Canada.

4. As would be required under section 7.10 (Privately Placed Funds Offered Primarily Abroad) of Rule 35-502 of the Securities Act (Ontario) the Funds are or will be non-Canadian and the securities of the Funds will be:

(i) primarily offered outside of Canada;

(ii) only distributed in Ontario through one or more registrants under the Securities Act (Ontario); and

(iii) distributed in Ontario in reliance upon an exemption from the prospectus requirements under the Securities Act (Ontario).

5. Prospective investors who are Ontario residents will receive disclosure that includes (a) a statement that there may be difficulty in enforcing legal rights against the Applicant, or the directors, officers or employees of the Applicant because they are resident outside of Canada and all or substantially all of their assets are situated outside of Canada, and (b) a statement that the Applicant is not registered with or licensed by any securities regulatory authority in Canada and, accordingly, the protections available to clients of a registered adviser will not be available to purchasers of securities of the Funds.

AND UPON being satisfied that it would not be prejudicial to the public interest for the Commission to grant the exemptions requested.

IT IS ORDERED, pursuant to section 80 of the Act that the Applicant and its directors, officers and employees responsible for advising the Funds are not subject to the requirements of paragraph 22(1)(b) of the Act in respect of the Proposed Advisory Business in connection with the Funds, for a period of three years, provided that at the time such Proposed Advisory Business is engaged in:

1. the Applicant continues to be regulated by the Financial Services Authority of the United Kingdom;

2. the Funds invest in futures and options contracts traded on organized exchanges located primarily outside of Canada and cleared through clearing corporations located primarily outside of Canada, in other derivative instruments traded over the counter primarily outside of Canada, and in securities primarily outside of Canada;

3. securities of the Funds will be offered primarily outside of Canada and will only be distributed in Ontario through Ontario-registered dealers, in reliance on an exemption from the prospectus requirements of the Securities Act (Ontario) and upon an exemption from the adviser registration requirements of the Securities Act (Ontario) under section 7.10 of Rule 35-502; and

4. prospective investors who are Ontario residents will receive disclosure that includes

(a) a statement that there may be difficulty in enforcing legal rights against the Applicant, or the directors, officers or employees of the Applicant because they are resident outside of Canada and all or substantially all of their assets are situated outside of Canada; and

(b) a statement that the Applicant is not registered with or licensed by any securities regulatory authority in Canada and, accordingly, the protections available to clients of a registered adviser will not be available to purchasers of securities of the Funds.

January 20, 2004.