Mawer Investment Management - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications - Variation order varying a prior order of a mutual fund to permit exemption from the requirement to deliver comparative annual financial statements of the mutual fund to securityholders unless requested by the securityholder, until proposed National Instrument 81-106 is in force.

Statutes Cited

Securities Act (Ontario), R.S.O. 1990 c. S.5, as am., s. 144.

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ALBERTA, ONTARIO AND NOVA SCOTIA

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

THE MRRS DECISION DOCUMENT

LISTED IN SCHEDULE 'A'

MRRS DECISION DOCUMENT

WHEREAS the Canadian securities regulatory authority or regulator (the "Decision Maker") in each of the Provinces of Alberta, Ontario and Nova Scotia (the "Jurisdictions") has received an application from the Executive Director of the Alberta Securities Commission, Ontario Securities Commission and Nova Scotia Securities Commission for a decision pursuant to the securities legislation of the Jurisdictions (the "Legislation") for a variation of the decision listed in Schedule 'A' (the "Prior Decision") until proposed National Instrument 81-106 -- Investment Fund Continuous Disclosure comes into force, to continue the relief from the requirement to deliver annual reports, where applicable, and comparative annual financial statements of the various mutual funds to securityholders of the mutual funds who hold units of the mutual funds in client name (the "Direct Securityholders") unless the Direct Securityholders have requested to receive them;

AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Alberta Securities Commission is the principal regulator for this application;

AND WHEREAS, unless otherwise defined, the terms herein have the meaning set out in National Instrument 14-101 Definitions;

AND WHEREAS it has been represented by the Executive Director to the Decision Makers that:

(a) In September 2002, the Canadian Securities Administrators (the "CSA") published for first comment proposed National Instrument 81-106 ("NI 81-106") which, among other things, would permit mutual funds not to deliver annual financial statements to those securityholders who do not request them, if the funds provide each securityholder with a request form under which the securityholder may request, at no cost to the securityholder, to receive the mutual fund's annual financial statements for that financial year.

(b) NI 81-106 would also require a mutual fund to have a toll-free telephone number for, or accept collect calls from, persons or companies that want to receive a copy of, among other things, the annual financial statements of the mutual fund.

(c) The Prior Decision gave exemptive relief from the requirement to deliver comparative annual financial statements of the various mutual funds to the Direct Securityholders unless the Direct Securityholders requested to receive them. The relief was only given for one annual reporting period based upon the assumption that NI 81-106 would be in force by the end of 2003.

(d) NI 81-106 will be published for further comment and therefore it was not in force at the end of 2003.

(e) As a result of NI 81-106 not being in force, the mutual funds that received prior relief under the Prior Decision require the relief to be extended until NI 81-106 comes into force to permit the mutual funds affected by the Prior Decision to not have to deliver their comparative annual financial statements to the Direct Securityholders unless the Direct Securityholders requested to receive them.

(f) Extending the prior relief given in the Prior Decision would not be prejudicial to the public interest since it would be consistent with the proposed requirements under NI 81-106.

AND WHEREAS pursuant to the System this MRRS Decision Document evidences the decision of each Decision Maker (collectively, the "Decision");

AND WHEREAS each of the Decision Makers are satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the Decision has been met;

AND WHEREAS the Decision Makers are satisfied that making the Decision will not adversely affect the rule-making process with respect to proposed National Instrument 81-106;

THE DECISION of the Decision Makers pursuant to the Legislation is that:

1. the Prior Decision is hereby varied such that the mutual funds affected by the Prior Decision shall not be required to deliver their annual reports, where applicable, and comparative annual financial statements to the Direct Securityholders other than those Direct Securityholders who have requested to receive the financial statements until NI 81-106 comes into force provided that the same terms and conditions as in the Prior Decision shall continue to apply;

2. this Decision shall terminate upon NI 81-106 coming into force.

March 9, 2004.

"Agnes Lau"

Schedule 'A'