Co-operators Mutual Funds Limited - MRRS Decision

MRRS Decision

Headnote

Mutual Reliance Review System for ExemptiveRelief Applications - Extension of lapse date for mutual fundprospectus to allow for completion of fund mergers and changeof control of the manager.

Statutes Cited

Securities Act, R.S.O. 1990 c. S.5, as amended,ss. 62(1), 62(2) and 62(5).

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

BRITISH COLUMBIA, ALBERTA,SASKATCHEWAN, MANITOBA, ONTARIO, QUEBEC,

NEW BRUNSWICK, NOVA SCOTIA,PRINCE EDWARD ISLAND, AND NEWFOUNDLAND AND LABRADOR

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

CO-OPERATORS CANADIAN CONSERVATIVEFOCUSED EQUITY FUND

CO-OPERATORS CANADIAN COREEQUITY FUND

CO-OPERATORS CANADIAN BALANCEDFUND

CO-OPERATORS CANADIAN BONDFUND

CO-OPERATORS CANADIAN MONEYMARKET FUND

CO-OPERATORS/CREDIT SUISSEINTERNATIONAL EQUITY FUND

CO-OPERATORS/CREDIT SUISSEU.S. CAPITAL APPRECIATION FUND

CO-OPERATORS/CREDIT SUISSEGLOBAL SCIENCE AND TECHNOLOGY FUND

CO-OPERATORS/CREDIT SUISSEGLOBAL POST-VENTURE CAPITAL FUND

CO-OPERATORS/CRYSTAL ENHANCEDINDEX RSP FUND

CO-OPERATORS/CRYSTAL ENHANCEDINDEX WORLD FUND

(collectively, the "Funds")

 

MRRS DECISION DOCUMENT

WHEREAS the Canadian securities regulatoryauthority or regulator (the "Decision Makers") ineach of the provinces of British Columbia, Alberta, Saskatchewan,Manitoba, Ontario, Québec, New Brunswick, Prince EdwardIsland, Nova Scotia and Newfoundland and Labrador (collectively,the "Jurisdictions") have received an applicationfrom Co-operators Mutual Funds Limited ("CMFL") inits capacity as manager of the Funds for a decision documentpursuant to the securities legislation of the Jurisdictions(the "Legislation") that the time period prescribedby the Legislation for filing the pro forma simplified prospectusand pro forma annual information form (together, the "RenewalProspectus") of the Funds be extended to the time periodthat would be applicable if the lapse date for the distributionof the units of the Funds was December 1, 2003;

AND WHEREAS under the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the Ontario Securities Commission is the principal regulatorfor this application;

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Québec Commission Notice 14-101;

AND WHEREAS CMFL has represented to theDecision Makers that:

1. CMFL is the manager, trustee and promoterof each of the Funds. CMFL is incorporated under the lawsof Ontario. The head office of CMFL is located in Guelph,Ontario.

2. Each of the Funds, other than the Co-operators/CrystalEnhanced Index RSP Fund and Co-operators/Crystal Index WorldFund (collectively, the "Co-operators/Crystal Funds"),is an open-ended mutual fund trust established under the lawsof Ontario pursuant to a Master Declaration of Trust datedSeptember 27, 2000 and a separate regulation thereunder, asamended. The Co-operators/Crystal Funds are also open-endedmutual fund trusts established under the laws of Ontario pursuantto a Master Declaration of Trust dated August 1, 2000, asamended.

3. Each Fund is a reporting issuer under theLegislation and is not in default of any requirement of theLegislation.

4. Units of the Funds are offered for saleon a continuous basis in each of the provinces and territoriesof Canada pursuant to a combined simplified prospectus andan annual information form each dated October 4, 2002 (together,the "Current Prospectus").

5. Pursuant to the Legislation, the lapsedate ("Lapse Date") of the Current Prospectus isOctober 4, 2003.

6. By press release dated August 15, 2003,CMFL announced its intention to merge (the "Mergers")each of Co-operators/Credit Suisse U.S. Capital AppreciationFund, Co-operators/Credit Suisse Global Science and TechnologyFund, and Co-operators/Credit Suisse Global Post-Venture CapitalFund (collectively, the "Terminating Funds") withCo-operators/Credit Suisse International Equity Fund (the"Global Fund").

7. In addition to the Mergers, CMFL is proposingto change the fundamental investment objective and investmentstrategies of the Global Fund. Upon completion of the Mergersand the change of fundamental investment objective of theGlobal Fund, CMFL also plans to change the name of the GlobalFund to Co-operators/Credit Suisse Global Equity Fund.

8. Unitholders of the Terminating Funds willbe asked to approve the Mergers at a special meeting to beheld on October 15, 2003. In addition, on the same date, unitholdersof the Global Fund will also be asked to approve the changeto the fundamental investment objective of the Global Fund.

9. In addition to the foregoing changes, IndustrialAlliance Insurance and Financial Services Inc. has agreedto acquire all of the common shares of CMFL that are ownedby 3664384 Canada Inc., an indirect wholly owned subsidiaryof The Co-operators Group Limited. The proposed transactionwill constitute a change of control of CMFL as manager andtrustee of the Funds. The sale of the shares is not expectedto close until on or about October 31, 2003, after the expiryof the requisite 60-day notice period under NI 81-102 andsubject to receipt of all necessary regulatory approvals.The proposed transaction was disclosed in a further pressrelease dated August 15, 2003.

10. On August 18, 2003, CMFL filed a MaterialChange Report regarding the proposed Mergers, the change tothe fundamental investment objective of the Global Fund, andthe proposed change of control of CMFL.

11. On September 4, 2003, CMFL applied forapproval of the Mergers pursuant to National Instrument 81-102Mutual Funds ("NI 81-102"). An additional applicationwill also be filed shortly pursuant to NI 81-102 for approvalof the change of control of CMFL.

12. Upon completion of the Mergers and thechange of control, CMFL will continue to be the trustee andmanager of the Funds.

13. CMFL filed on August 22, 2003 an AmendmentNo. 1 to the Current Prospectus which discloses, interalia, the proposed Mergers and change of investment objectiveof the Global Fund, as well as the proposed change of controlof CMFL.

14. The extension of the Lapse Date for filingthe Renewal Prospectus will enable the necessary approvalsto be obtained and the notice period to expire for the variousmatters outlined in paragraphs 8 and 9 above prior to thefiling of the Renewal Prospectus.

AND WHEREAS under the System, this DecisionDocument evidences the decision of each of the Decision Makers(the "Decision");

AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Makers with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers pursuantto the Legislation is that the Lapse Date for filing the RenewalProspectus of the Funds be extended to the time period thatwould be applicable if the Lapse Date for the distribution ofunits of the Funds was December 1, 2003, provided:

(a) the Renewal Prospectus of the Funds isfiled in final form no later than December 5, 2003, and

(b) a final receipt is issued for the RenewalProspectus no later than December 12, 2003.

September 25, 2003.

"Susan Silma"