GWP Wealth Management Inc. - s. 74(1) of the Act and s. 6.1 of the Rule
Headnote
Adviser firm registered in Alberta, and its Alberta-registered representatives, exempted from the adviser registration requirement in section 25(1)(c) of the Act, where the firm, and the representative, acts as an adviser in Ontario to two individual clients, who were clients of the firm in Alberta, before they moved to Ontario -- Terms and conditions on exemption ruling correspond to the relevant terms and conditions on the comparable "mobility exemption" from the adviser registration requirement set out in Division 2 of Part 8 of proposed NI 31-103 Registration Requirements -- Exemption also subject to a "sunset clause" condition.
Adviser firm also exempted, under section 6.1 OSC Rule 13-502 Fees, from the activity fees, which it would otherwise be required to pay under section 4.1 of the Rule, for making the application for the exemption from section 25(1)(c) of the Act and for making the application for the exemption under the Rule.
Statutes Cited
Securities Act, R.S.O. 1990, c. S.5, as am., s. 74 (1), 25(1)(c).
Instruments Cited
Proposed National Instrument 31-103 Registration Requirements, (2008) 31 OSCB 2279, Part 8 -- Exemptions from Registration, Division 2: Mobility Exemptions.
National Instrument 31-101 National Registration System.
Rules Cited
Ontario Securities Commission Rule 13-502 Fees, ss. 4.1, 6.1.
IN THE MATTER OF
THE SECURITIES ACT,
R.S.O. 1990, CHAPTER S.5
AS AMENDED (the "Act")
AND
ONTARIO SECURITIES COMMISSION
RULE 13-502 FEES (the "Rule")
AND
IN THE MATTER OF
GWP WEALTH MANAGEMENT INC.
RULING AND EXEMPTION
(Subsection 74(1) of the Act and
Section 6.1 of the Rule)
UPON the application (the Application) of GWP Wealth Management Inc. (the Applicant Firm) to:
(i) the Ontario Securities Commission (the Commission) for a ruling, pursuant to subsection 74(1) of the Act, that the adviser registration requirement in section 25(1)(c) of the Act shall not apply to the Applicant Firm, or to any Applicant Representative (as defined below) acting on its behalf, where the Applicant Firm, and the Applicant Representative, acts as adviser to an Eligible Client (as defined below), subject to certain terms and conditions; and
(ii) the Director for a decision, under section 6.1 of the Rule, exempting the Applicant Firm from paying the activity fees which the Applicant Firm would otherwise be required to pay under section 4.1 of the Rule for making the application to the Commission for the ruling and for making the application to the Director for this decision;
AND WHEREAS for the purposes hereof the following terms shall have the following meanings:
Applicant Representative means an individual who is registered to act as adviser on behalf of the Applicant Firm under the securities legislation of the principal jurisdiction of the Applicant Representative;
Eligible Clients means the two individuals more particularly identified by the Applicant Firm in its Application;
NI 31-101 means National Instrument 31-101 National Registration System;
NI 31-103 means National Instrument 31-103 Registration Requirements;
principal jurisdiction means, for a person or company, the jurisdiction of the principal regulator;
principal regulator means
(a) for a person or company other than an individual, the securities regulatory authority or the regulator in the jurisdiction of Canada in which the person or company's head office is located, and
(b) for an individual, the securities regulatory authority or the regulator in the jurisdiction of Canada in which the individual's working office is located; and
working office has the same meaning as in NI 31-101;
AND WHEREAS any other terms used herein that are defined in National Instrument 14-101 Definitions shall have the same meaning, unless herein otherwise specifically defined, or the context otherwise requires;
AND UPON considering the Application and the recommendation of staff of the Commission;
AND UPON the Applicant Firm having represented to the Commission that:
1. The Applicant Firm is a corporation incorporated under the laws of Alberta.
2. The Applicant Firm's principal jurisdiction is Alberta.
3. The Applicant Firm is registered under applicable securities legislation in Alberta as an adviser in the category of "investment counsel" and "portfolio manager".
4. Although each of the Eligible Clients now resides in Ontario, immediately before each Eligible Client became a resident of Ontario, the Eligible Client resided in Alberta and was a client of the Applicant Firm.
5. Each Eligible Client is the spouse of the other Eligible Client.
6. Except for the Eligible Clients, in Ontario the Applicant Firm does not act as an adviser to any persons or companies.
7. Under exemptions from the adviser registration requirement which are set out in Division 2 of Part 8 of proposed NI 31-103 (which was published for comment in the February 29, 2008 OSC Bulletin), the Applicant Firm and the Applicant Representatives would be able to act as an adviser to each of the Eligible Clients in the circumstances contemplated by this ruling, without having to obtain registration under the Act as an adviser, subject to satisfying certain additional filing requirements specified in the proposed NI 31-103.
AND UPON the Commission being satisfied that to do so would not be prejudical to the public interest;
IT IS RULED, pursuant to subsection 74(1) of the Act, that the Applicant Firm and Applicant Representatives shall not be subject to the adviser registration requirement, where the Applicant Firm, and the Applicant Representative acting on behalf of the Applicant Firm, acts as an adviser to an Eligible Client, provided that, at the relevant time:
A. the principal jurisdiction of the Applicant Firm and the Applicant Representative is Alberta;
B. the Applicant Firm is registered as an adviser, and the Applicant Representative is registered to act as an adviser on behalf of the Applicant Firm, under the securities legislation of Alberta;
C. the only individuals who act as an adviser to the Eligible Client on behalf of the Applicant Firm are Applicant Representatives, who act as an adviser to the Eligible Client on behalf of the Applicant Firm pursuant to this ruling;
D. neither the Applicant Firm, nor the Applicant Representative, acts as an adviser in Ontario, other than as the Applicant Firm, or Applicant Representative, is permitted to so act in their principal jurisdiction, according to their category of registration in the principal jurisdiction (including any specific terms and conditions on such registration);
E. in Ontario, neither the Applicant Firm nor the Applicant Representative acts as an adviser to any company or to any person who is not an Eligible Client;
F. the Applicant Firm and the Applicant Representative act fairly, honestly and in good faith in the course of their dealing with the Eligible Client;
G. in the case of each Eligible Client, the Applicant Firm has disclosed to the Eligible Client that the Applicant Firm, and any individuals that may act as an investment adviser on its behalf, have obtained an exemption from the requirement to obtain registration as an adviser under the securities legislation of Ontario, and, to the extent that they act as investment adviser to the Eligible Client pursuant to such exemption, they are not subject to requirements that might otherwise be applicable under that legislation; and
H. this ruling shall terminate upon the earlier of:
(i) the Applicant Firm being registered under the Act;
(ii) the coming into force of NI 31-103; and
(iii) September 4, 2011.
September 4, 2008
"Suresh Thakrar"
"Wendell S. Wigle"
AND UPON the Director being satisfied that to do so would not be prejudicial to the public interest;
IT IS THE DECISION of the Director, pursuant to section 6.1 of the Rule, that the Applicant Firm shall not be subject to the activity fees under section 4.1 of the Rule that would otherwise apply in respect of the Applicant Firm making the Application.
September 5, 2008
"David M. Gilkes"