Marathon Asset Management LLP - s. 218 of the Regulation
Headnote
Applicant for registration as limited market dealer exempted, pursuant to section 218 of the Regulation, from section 213 of the Regulation, subject to terms and conditions.
Statutes Cited
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 26(3), 53.
Regulations Cited
Regulation made under the Securities Act, R.R.O. 1990, Reg. 1015, as am., ss. 213, 218.
Instruments Cited
National Instrument 45-106 -- Prospectus and Registration Exemptions.
IN THE MATTER OF
THE SECURITIES ACT, R.S.O. 1990,
CHAPTER S.5, AS AMENDED (THE "ACT")
AND
IN THE MATTER OF
R.R.O. 1990, REGULATION 1015,
AS AMENDED (THE "REGULATION"),
MADE UNDER THE ACT
AND
IN THE MATTER OF
MARATHON ASSET MANAGEMENT LLP
ORDER
(Section 218 of the Regulation)
UPON the application (the Application) of Marathon Asset Management LLP (the Applicant) to the Ontario Securities Commission (the Commission) for an order, pursuant to section 218 of the Regulation, exempting the Applicant from the requirement in section 213 of the Regulation that the Applicant be incorporated under the laws of Canada or a province or territory of Canada, in order for the Applicant to be registered under the Act as a dealer in the category of "limited market dealer";
AND UPON considering the Application and the recommendation of staff of the Commission;
AND UPON the Applicant having represented to the Commission that:
1. The Applicant is a company incorporated as a limited liability partnership under the laws of England and Wales. The head office of the Applicant is in London, England.
2. The Applicant is authorized and regulated by the Financial Services Authority in the United Kingdom.
3. The Applicant is currently registered under the Act as an adviser in the category of "international adviser". The Applicant has applied for registration under the Act as a dealer in the category of "limited market dealer".
4. In connection with its existing registration under the Act as an adviser, and its application for registration under the Act as a dealer, the Applicant has appointed an agent for service of process, that is resident in Ontario, and has filed a Form of Submission to Jurisdiction and Appointment of Agent for Service of Process in the required form. In addition, each of the individuals that is currently registered to act as an adviser on behalf of the Applicant and any individuals that are subsequently registered to act as an adviser on behalf of the Applicant, or registered to trade on behalf of the Applicant, will have, before they are registered, appointed an agent for service of process, that is resident in Ontario, and filed a Form of Submission to Jurisdiction and Appointment of Agent for Service of Process in the required form.
5. The Applicant is applying for registration as a limited market dealer in order to act as an intermediary in respect of the purchase by its clients of securities that are distributed pursuant to exemptions from the prospectus requirement in section 53 of the Act that are contained in National Instrument 45-106 -- Prospectus and Registration Exemptions.
6. In connection with its activities as a limited market dealer, the Applicant will not: (i) hold any funds, securities or other assets on behalf of any client of the Applicant; or (ii) exercise any control (including any discretionary authority) in respect of any funds, securities or other assets of any client of the Applicant.
7. The Applicant does not propose to incorporate (or otherwise form or create) a separate Canadian company (or other entity) in order to carry out its proposed dealer activities in Ontario, which the Applicant believes can be carried out by itself on a more cost-effective and efficient basis.
8. In connection with its application for registration under the Act as a "limited market dealer", the Applicant has agreed to the imposition of specific terms and conditions (the Registration Terms and Conditions) on this registration, as set out in the attached Schedule A, pursuant to section 26 of the Act.
AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;
IT IS ORDERED, pursuant to section 218 of the Regulation, that, in connection with the registration of the Applicant under the Act as a dealer in the category of a "limited market dealer", the Applicant is hereby exempted from section 213 of the Regulation, provided that:
1. the Applicant complies with the Registration Terms and Conditions; and
2. this exemption shall terminate on the day that is three years after the date hereof, unless earlier renewed.
January 30, 2007
Schedule A
Specific Terms and Conditions on the Registration under the Securities Act (Ontario) (the Act) of Marathon Asset Management LLP (the Applicant) as a Limited Market Dealer
1. Before the Applicant carries on any trading activity with or on behalf of, or acts as an adviser to, any client pursuant to its registration under the Act as a limited market dealer, the Applicant shall (if it has not already done so) provide to the client a statement in writing that:
(i) discloses the non-resident status of the Applicant in Ontario;
(ii) identifies the Applicant's jurisdiction of residence and the name and address of the Applicant's agent for service of process in Ontario; and
(iii) disclose the nature of risks to clients that legal rights may not be enforceable.
2. The Applicant will not change its agent for service of process in Ontario without giving the Director and its clients 30 days' prior notice of such change, which shall, in the case of the Director, be given by filing with the Commission (Attention: Manager, Registrant Regulation) a new Submission to Jurisdiction and Appointment of Agent for Service of Process, in the required form.
3. In connection with its activities as a limited market dealer, the Applicant will not: (i) hold any funds, securities or other assets on behalf of any client of the Applicant; or (ii) exercise any control (including any discretionary authority) in respect of any funds, securities or other assets of any client of the Applicant.
4. The Applicant will inform the Director immediately upon the Applicant becoming aware that:
(a) it has ceased to be authorized and regulated by the Financial Services Authority in the United Kingdom;
(b) its licensing or registration by any financial services authority, securities regulatory authority or self-regulatory authority in any Canadian or foreign jurisdiction is not being renewed or is being suspended or revoked;
(c) it is the subject of an investigation or disciplinary action by any financial services authority, securities regulatory authority or self-regulatory authority in any Canadian or foreign jurisdiction;
(d) the licensing or registration of any of the individuals (an Applicant Representative), that is registered under the Act to trade or act as an adviser on behalf of the Applicant, is being suspended or revoked by any financial services authority, securities regulatory authority or self-regulatory authority in any Canadian or foreign jurisdiction; or
(e) any Applicant Representative is the subject of an investigation or disciplinary action by any financial services authority, securities regulatory authority or self-regulatory authority in any Canadian or foreign jurisdiction.
5. The Applicant will pay any increased compliance and case assessment costs of the Commission due to the Applicant's location outside of Ontario, including the cost of hiring a third party to perform a compliance review on behalf of the Commission.
6. The Applicant will make any books and records (including electronic records) of the Applicant that are outside of Ontario readily accessible to the Commission, and will produce these books and records for the Commission within a reasonable time, upon the request of the Commission.
7. If the laws of the jurisdiction in which the Applicant's books and records are located prohibit production of these books and records in Ontario, without the consent of a client of the Applicant, the Applicant shall, upon the request of the Commission:
(a) so advise the Commission; and
(b) use its best efforts to obtain the client's consent to the production of the books and records.
8. The Applicant will, upon the Commission's request, provide a representative to assist the Commission in compliance and enforcement matters.
9. The Applicant and each of the individuals registered to trade or act as an adviser on behalf of the Applicant will comply, at the Applicant's expense, with requests under the Commission's investigation powers and orders under the Act, in relation to the Applicant's dealings with clients -- including producing documents and witnesses in Ontario, submitting to audit or search and seizure process, or consenting to an asset freeze -- to the extent such powers or orders would be enforceable against the Applicant if the Applicant were resident in Ontario.
10. If the laws of the Applicant's jurisdiction of residence that are otherwise applicable to the giving of evidence or production of documents prohibit the Applicant or a witnesses from giving evidence without the consent or leave of a client or any third party, including a court of competent jurisdiction, the Applicant shall:
(a) so advise the Commission; and
(b) use its best efforts to obtain the client's consent to the giving of the evidence.
11. The Applicant will maintain appropriate registration and regulatory organization membership, in the Canadian or foreign jurisdiction of its principal operations, and if required, in its Canadian or foreign jurisdiction of residence.