Notice and National Policy (effective January 1, 2000): NP - 43-201 - Mutual Reliance Review System for Prospectus and Annual Information Forms

NOTICE OF NATIONAL POLICY 43-201

MUTUAL RELIANCE REVIEW SYSTEM FOR
PROSPECTUSES AND ANNUAL INFORMATION FORMS

AND

NOTICE OF RESCISSION OF NATIONAL POLICY STATEMENT NO. 1

The Commission, together with other members of the Canadian Securities Administrators("CSA"), has adopted National Policy 43-201 Mutual Reliance Review System forProspectuses and Annual Information Forms (the "National Policy") and has rescindedNational Policy Statement No. 1 Clearance of National Issues ("NPS 1"). The NationalPolicy will come into force and NPS 1 will be rescinded effective January 1, 2000. TheCommission anticipates rescinding National Policy Statement No. 30 Processing of"Seasoned Prospectuses" ("NPS 30"). The Commission is publishing a notice of theproposed rescission of NPS 30 concurrently with this Notice.

The National Policy establishes the mutual reliance review system ("MRRS") forprospectuses (including long form, short form and mutual fund prospectuses), prospectusamendments, waiver applications, pre-filing discussions and initial and renewal AnnualInformation Forms ("AIFs"). The CSA adopted a memorandum of understanding (the"MOU") signed as of October 14, 1999 to implement the MRRS. The Commissionpublished the MOU on October 29, 1999 and the MOU will come into effect on January 1,2000. The MOU will supercede the Memorandum of Understanding that implemented theExpedited Review System for Prospectuses and Renewal Annual Information Forms (the"Expedited Review MOU").

Background

The draft National Policy and the draft MOU were published for comment in June, 1998.Proposed Appendix A to the National Policy was published for comment in July, 1998 (thedraft National Policy and proposed Appendix A, together referred to as the "1998Publication Drafts").

The National Policy is derived, in part, from the Expedited Review MOU, NPS 1, NPS 30and National Policy Statement No. 47 Prompt Offering Qualification System ( "NPS 47").The National Policy consolidates the procedures for the filing and co-ordinated review ofprospectuses and AIFs previously contained in those instruments.

TRANSITION

The Commission will not accept new filings made under NPS 1 or the Expedited ReviewMOU after December 31, 1999. Filings made under NPS 1 or the Expedited Review MOUprior to January 1, 2000 will to continue to be processed in accordance with the systemscontemplated in those instruments. The Commission will accept filings in accordance withthe National Policy on a test basis until its effective date.

Unlike the Expedited Review MOU, the National Policy does not provide for an appendixcontaining a list of filers and their principal regulators. For those filers who have requestedand were granted a change of principal regulator under the Expedited Review MOU, theprincipal regulator will be the regulator assigned to that filer following the application forchange. For those filers whose head office is located in a jurisdiction in which theregulator is not willing to act as principal regulator, the filer may continue to use theprincipal regulator attributed to the filer under the Expedited Review MOU. Filers shouldnote in their cover letter accompanying materials filed whether they have requested achange under the Expedited Review MOU.

Substance and Purpose of the National Policy

The National Policy applies the principles of the MRRS to the review of prospectuses, AIFsand related filings in order to reduce unnecessary duplication in the review of materialsfiled in multiple jurisdictions. The MRRS is an important step towards increasingharmonization. Under the MRRS, each non-principal regulator relies primarily on thereview and analysis of the principal regulator in reaching its own decision.

Summary of National Policy

The following is a brief summary of the procedures set out in the National Policy whichapply the MRRS principles to the filing and review of prospectuses, prospectusamendments, waiver applications, pre-filing discussions and initial and renewal AIFs.

• In most cases, the principal regulator of a filer is the regulator in the jurisdiction inwhich the head office of the filer (or in the case of a mutual fund, its manager) islocated. In certain circumstances, a filer's principal regulator can be changed: i)automatically, ii) at the request of the filer in exceptional circumstances, or iii) at therequest of the participating principal regulators.
• A filer must file materials in all jurisdictions in which the filer is proposing todistribute securities, although the principal regulator is primarily responsible for thereview. Even when the filer does not propose to offer securities by way ofprospectus to purchasers resident in the jurisdiction of the principal regulator, thefiler must still file the prospectus with the principal regulator as the principalregulator will review the materials.
• The periods for the review by the principal regulator and the non-principalregulators are consistent with those in the Expedited Review MOU, NPS 47 andNPS 1 except where the review periods have been shortened because of selectivereview procedures.
• A non-principal regulator is entitled to opt out of the MRRS for any particular filing.In that case, the non-principal regulator will deal directly with the filer.
• Generally, a non-principal regulator will opt out for two reasons, either
• the issuer has not met certain technical requirements in the jurisdiction of the non-principal regulator or has not received the necessary exemptive relief. An opt-outmade on this basis will generally occur shortly after the filing is made. Once thetechnical requirements are met or the exemptive relief obtained, the non-principalregulator may be able to opt back into the MRRS for the materials, or
• there is a significant substantive issue with the filing in the jurisdiction of the non-principal regulator. An opt-out made on this basis will generally occur shortly beforethe principal regulator issues a final MRRS decision document followingunsuccessful attempts to resolve the issue through the principal regulator.
• The MRRS will not be available if the principal regulator refuses to issue a receiptfor a prospectus or a notice of acceptance for an AIF. Following a refusal, a filercan pursue its right of appeal.
• The National Policy contains procedures that apply to applications for relief that areevidenced by the issuance of a receipt ("waiver applications"). All otherapplications for relief should be filed under National Policy 12-201 Mutual RelianceReview System for Exemptive Relief Applications (the "Applications Policy") if co-ordinated review is desired. Appendix B to the National Policy sets out thosewaiver applications which should be processed in accordance with the provisionsof the National Policy. The list in Appendix B may be updated from time to time.
• The principal regulator deals with novel or substantive pre-filings and waiverapplications in consultation with the non-principal regulators. The principalregulator alone deals with those that are routine. However, filers will need torequest, in their cover letter, that non-principal regulators grant the same relief thatthe principal regulator has granted.
• If relief is not required in the jurisdiction of the principal regulator a filer shoulddesignate an alternate principal regulator for the purposes of waiver applicationsor pre-files.
• The National Policy sets out procedures to deal with amendments to the preliminaryand final prospectus.
• As a result of statutory provisions in Québec, a filer should include in the coverletter accompanying amendment materials a statement that it waives its right inQuébec to a decision within two days and that it undertakes to cease distributingsecurities in Québec until the prospectus amendment MRRS decision document isissued.
• Appendix A sets out the materials that must be filed or delivered in connection witheach category of filing in each relevant jurisdiction before a MRRS decisiondocument will be issued. This includes the French translation of documents wherethey are required to be filed. Appendix A will be amended from time to time, in partto conform to changes resulting from the reformulation of related instruments.

Summary of Changes to the National Policy from the 1998 publication drafts

Starting in August, 1998, the CSA and numerous law firms across Canada participated intesting the MRRS as contemplated in the 1998 Publication Drafts.

The comment period on the 1998 Publication Drafts ended on September 19, 1998. TheCSA received 4 comment letters. Appendix A of this Notice lists the commenters on the1998 Publication Drafts. The CSA considered the comments received and would like tothank each commenter for taking the time to provide their comments. Appendix B to thisNotice provides a summary of the comments received and the responses of the CSA.

This section briefly summarizes the substantive changes made in the National Policy fromthe 1998 Publication Drafts. The CSA made changes to respond to comments receivedfrom industry participants and the experience that staff of the various CSA jurisdictionsderived during the MRRS testing phase. All section references below are to the NationalPolicy.

The National Policy has changed from the 1998 Publication Drafts by

Principal Regulator

• providing for the automatic change of principal regulator where the head office ofthe filer moves to another jurisdiction that is prepared to act as principalregulator. (Section 3.3)
• providing that any other change in principal regulator will only be permitted inexceptional circumstances (Section 3.4)
• providing that for the first filing made after a change in principal regulator, a filermust indicate the change in SEDAR (Section 3.8)

Blacklined Documents

• clarifying that, consistent with NPS 1, filers are not required to file a black-lineddocument or translated black-lined document prior to final materials but arestrongly encouraged to do so (Section 4.3)
• including the relevant filing and review procedures for "seasoned prospectuses",previously contained in NPS 30, but requiring a certificate from the filer (ratherthan a lawyer or other responsible person) as to the accuracy of the marking ofchanges (Section 4.4)

AIF

• including a review procedure for renewal AIFs, which is largely derived from theExpedited Review MOU and NPS47, except that the 10 day time limit forprincipal regulators to determine whether to review a renewal AIF has beendeleted and the concept of "accepting" a renewal AIF has also been deleted(Section 5.5)

Receipt Procedures

• clarifying that only those underwriters registered in a jurisdiction can undertakeactivities for which registration is required (Section 7.2(2)(c))
• requiring the filer to confirm, when the preliminary prospectus is filed, that atleast one underwriter is registered, or has filed an application for registration orfor exemption from registration, in each jurisdiction in which the distribution isproposed to be made (Section 7.2(2)(c))
• requiring the filer to confirm, when the final prospectus is filed, that at least oneunderwriter that has signed the prospectus is actually registered or has obtainedan exemption from registration in each jurisdiction in which the distribution isproposed to be made (Section 7.4(4)(c))
• indicating that for New Brunswick, Prince Edward Island, Yukon, NorthwestTerritories and Nunavut, silence will imply consent and the principal regulatorwill be able to issue a MRRS Decision Document on that basis (Section 7.4 andSection 7.8)

Material Issues Raised Late

• defining a "material issue" for this purpose to include only potential receiptrefusal issues (Section 7.8)
• adding a five day response period in which non-principal regulators willreconfirm they are clear for final after a late material issue has been identified(Section 7.8)

Pre-Filings and Waivers

• providing that a filer should designate an alternate principal regulator for thepurposes of a pre-filing or waiver application where the relief is not required inthe jurisdiction of the principal regulator (Section 9.1).
• including a list of those waiver applications that should be made under Part 9 ofthe National Policy rather than under the Applications Policy (Appendix B)

Related Instruments

The National Policy, the Applications Policy and the MOU are related.

Rescission of National Policy Statement No. 1

NPS 1 is replaced by the National Policy. The text of the rescission is:

"National Policy Statement No. 1 Clearance of National Issues ("NPS 1") isrescinded effective January 1, 2000"

Questions may be referred to any of:

Marcine Renner
Manager, Corporate Finance
British Columbia Securities Commission
(604) 899-6711
or (800) 373-6393 (in B.C.)
[email protected]

Brenda Benham
Director, Policy & Legislation
British Columbia Securities Commission
(604) 899-6635
or (800) 373-6393 (in B.C.)
[email protected]

Ken Parker
Director, Capital Markets
Alberta Securities Commission
(403) 297-3251
[email protected]

Glenda Campbell
Vice-Chair
Alberta Securities Commission
(403) 297-4230
[email protected]

Ian McIntosh
Deputy Director, Corporate Finance
Saskatchewan Securities Commission
(306) 787-5867
[email protected]

Robert Bouchard
Director, Corporate Finance
Manitoba Securities Commission
(204) 945-2555
[email protected]

James McVicar
Legal Counsel, Corporate Finance
Ontario Securities Commission
(416) 593-8154
[email protected]

Iva Vranic
Manager, Corporate Finance
Ontario Securities Commission
(416) 593-8115
[email protected]

Rose Fergusson
Sr. Accountant, Corporate Finance
Ontario Securities Commission
(416) 593-8116
[email protected]

Jacques Beaudoin
Analyste financier, Marchés des capitaux
Commission des valeurs mobilières du Québec
(514) 940-2199, Ext 4352
[email protected]

Rosetta Gagliardi
Conseillère en réglementation, Service de la réglementation
Commission des valeurs mobilières du Québec
(514) 940-2199, Ext 4554
[email protected]

William Slattery
Deputy Director
Corporate Finance and Administration
Nova Scotia Securities Commission
(902) 424-7355
[email protected]

DATED: November 19, 1999

APPENDIX A
List of Commenters

1. Osler, Hoskin & Harcourt by letter dated September 17, 1998.

2. Canadian Bankers Association by letter dated September 18, 1998.

3. Ogilvy Renault by letter dated September 23, 1998.

4. Canadian Advocacy Council of the Association for Investment Managementand Research by letter dated October 22, 1998.

APPENDIX B

Summary of Written Comments Received and Response of the CSA

All section references below refer to the National Policy unless otherwise indicated.Bracketed numbers represent the corresponding section numbers in the 1998 PublicationDrafts.

Discussion of General Comments

National Securities Commission and Regulatory Efficiencies

Three of the commenters strongly supported the regulatory initiatives of the CSA designedto increase the efficiency of securities regulation in Canada by eliminating duplication andharmonizing the legislation of each of the provinces. However, one of these commentersfavoured creating a national securities commission rather than a "virtual" nationalsecurities commission.

One commenter suggested developing a uniform fee schedule that would provide forreduced fees for filings made with non-principal regulators reflecting the decreasedregulatory burden imposed on these jurisdictions under the MRRS. Furthermore, thecommenter urged the CSA to consider the benefits of a principal regulator model withauthority to make binding decisions for non-principal regulators for limited purposes.

The CSA note the support for the MRRS initiatives and intend to continue their discussionson the MRRS with a view to continually improving the effectiveness of the system.

The MRRS is a review system adopted to streamline the review of materials and does notimply a decreased regulatory burden for the jurisdictions participating in the system. TheCSA is of the view that it is beyond the scope of the MRRS to amend the fee schedule.However, a committee of the CSA is in the process of reviewing the general fee structure.

In response to the comment concerning the benefits of a principal regulator makingdecisions which bind other regulators, the CSA note that due to statutory requirements inseveral jurisdictions, the MRRS cannot provide for a regulator to make binding decisionson behalf of other regulators.

Scope

One commenter suggested maintaining the current Expedited Review system for renewalAIFs until the development of an MRRS instrument dealing with continuous disclosuredocuments. Alternatively, the commenter suggested including renewal AIFs in the MRRSunder the National Policy.

As a result of the comment, the National Policy has been amended to include RenewalAIFs. See section 5.5 of the National Policy.

Testing and Comment Period

One commenter strongly supported the practice of testing policies before finalizing them.Another commenter would have liked a longer testing period before the end of thecomment period.

The CSA agree that testing the MRRS is beneficial and note that testing of the MRRS willcontinue until the National Policy comes into force.

Continuous Disclosure Filings

One commenter noted that Industry Canada is presently working on its own system ofelectronic filing and electronic issuance of documents, tentatively known as SOURCE.The commenter understood that SOURCE would not be linked to SEDAR in theforeseeable future. As a result, federally-incorporated companies would continue to fileannual financial statements and proxy circulars both federally and provincially. Thecommenter urged the CSA to consider the efficacy of including links to SEDAR for relatedelectronic filings.

The CSA note the comment regarding linking SEDAR to SOURCE and have forwardedit to the SEDAR working committee.

Discussion of Specific Comments

Drafting Comments

Several commenters made various drafting suggestions.

The CSA have considered these comments and, in several places, have made changesto address the concerns of the commenters.

Section 2.1 - Definitions

One commenter suggested defining the terms "principal regulator" and "participatingprincipal regulator" in the National Policy. In addition, the commenter felt that the term"MRRS decision document" was unwieldy. The commenter suggested replacing it with thesimpler (and widely understood) term "receipt", to be applied to both prospectuses andAIFs.

Since the terms "principal regulator" and "participating principal regulator" are defined inthe MOU, the CSA believe that it is not necessary to define them in the National Policy aswell. Section 2.2 was added to indicate that terms that are not defined in the NationalPolicy but are defined in the MOU should be read in accordance with the MOU. Withrespect to the term "MRRS decision document", the CSA do not believe that the term"receipt" is an accurate replacement. Moreover, using the term "receipt" in the NationalPolicy might be confusing given its use in securities legislation in Canada.

The National Policy distinguishes between "applications" and "waiver applications"depending on whether or not a decision document separate from the MRRS decisiondocument is issued. If a separate decision document is issued, it is an application underthe Application Policy. If a separate decision document is not issued, it is a waiverapplication under the National Policy. According to one commenter, it is not clear how thedistinction will be applied because there is no homogeneity among different jurisdictionsas to the kinds of exemptions that require separate decisions and those that do not. Thecommenter suggested amending the National Policy to clarify the ambiguity and addinga schedule of applications that would be considered waiver applications.

The CSA agree that there may be filings where a formal order is required is somejurisdictions while the issuance of a receipt will evidence the required relief in otherjurisdictions. Consequently, a list of applications, for which there is ambiguity regardingwhether they should be made under the National Policy or the Applications Policy butwhich the CSA have determined should be made under the National Policy, has beenadded to the National Policy as Appendix B.

Section 3.2 - Determination of Principal Regulator

One commenter noted that under the Applications Policy, an applicant that does notrequire exemptive relief in the jurisdiction of its principal regulator may select an alternateprincipal regulator for that application and that testing has shown that this provision wasuseful. The commenter felt that a similar provision should be provided for prospectusfilings.

Section 9.1 of the National Policy has been amended to permit the designation of analternate principal regulator for pre-filings and waiver applications where no relief isneeded in the jurisdiction of the principal regulator. The National Policy has not, however,been amended to provide for the designation of an alternate principal regulator in othercircumstances. The CSA believe that, in order to achieve the benefits of a consistent andfamiliar relationship between the issuer and its principal regulator, all prospectuses mustbe filed with the principal regulator regardless of whether or not securities are beingdistributed to purchasers in that jurisdiction. A similar approach was not adopted in theApplications Policy since the securities requirements in the jurisdiction of the principalregulator may not contain the requirement from which an exemption is being requested.Consequently, lack of familiarity with the legislative requirements could hinder the principalregulator handling the matter expeditiously and therefore undermine the efficacy of theMRRS.

Section 3.3 - Automatic Change of Principal Regulator

According to one commenter, the language in section 3.2 of the1998 Publication Draftssuggested that the "principal regulator" could be changed automatically or as a result ofan exercise of discretion. The commenter felt that this was confusing. The commentersuggested that: (1) only a change in the location of the head office of the filer (or mutualfund manager) should result in an automatic change; (2) regardless of when an event thatwould result in an automatic change of principal regulator occurs, the change of principalregulator should not be effective until the next MRRS filing; (3) notification of the changein principal regulator should be made in the MRRS filing letter; and (4) all other changesin the circumstances relevant to the determination of principal regulator should bediscretionary not automatic.

As a result of the comment, the National Policy has been amended to provide in section3.3 that the principal regulator is changed automatically only if the head office of the filer(or mutual fund manager) is moved to a jurisdiction in which a participating principalregulator is located. The National Policy has also been changed to clarify that if materialshave been filed, the principal regulator will not be changed until after the filing has beencompleted. In addition, section 3.8 has been added to include a requirement thatdesignation of a new principal regulator be indicated in the SEDAR cover page informationin connection with the first filing made subsequent to the change of principal regulator.

Section 3.4 [3.3] - Discretionary Change of Principal Regulator

One commenter was concerned that the administrative efficiency test for a discretionarychange of principal regulator was too restrictive. The commenter felt that it would bepreferable to delete the reference to administrative efficiency in both places where itappears, and leave the National Policy silent on the point. Another commenter thoughtthat, in light of current technology, it was unclear what administrative efficiencies wouldresult from a change of principal regulator based on geographical proximity.

The CSA note the comment. The term "administrative efficiency" has been replaced withthe term "exceptional circumstances".

One commenter felt that the mechanism for a discretionary change was suited to handlechanges in the "reasonable connection" of the filer to the jurisdiction of the principalregulator previously selected pursuant to clause 3.2(1)(b) or (d).

The CSA agree that the mechanism for a discretionary change of principal regulator issuited to handle changes relevant to the original determination of principal regulator underclause 3.2(1)(b) or (d). As indicated above, the National Policy has been amended toprovide for an automatic change of principal regulator in certain circumstances.

The National Policy requires filing an application for a change with both the principal andrequested regulator. One commenter felt that the application should be filed only with theprincipal regulator because only that regulator would know if the change would result inadministrative efficiencies since it administered the filings in question. The commenternoted that where a "reasonable connection" exists, section 3.2 does not permit therequested regulator to decline to act and questioned why discretion was granted in thecontext of an application for a discretionary change of principal regulator.

The CSA note that the system is intended to create efficiencies not only for filers but alsofor regulators and therefore consultation among regulators is necessary to ensure that therequested regulator is able to assume the role of principal regulator. Further, the NationalPolicy does not usurp the discretion of the requested regulator to determine whether ornot to assume the role of principal regulator.

Since the National Policy requires filing an application for a change with both the principaland requested regulator, the commenter thought that it should address what happens ifthere is an impasse.

The CSA believe that disagreements will be extremely rare. If a disagreement arises, thetwo regulators will discuss the issue with the appropriate CSA committee. The CSA doesnot feel that it is necessary to amend the National Policy to address this issue.

One commenter felt that where the head office of the filer is located in one of thejurisdictions having accepted to act as principal regulator, no changes should be allowed.

The CSA note the comment and have amended the National Policy to indicate thatchanges would be permitted only in exceptional circumstances. However, there may becircumstances where the head office of the filer (or mutual fund manager) may not be inthe jurisdiction of the most appropriate principal regulator for that filer. Consequently, theNational Policy permits discretionary changes of principal regulator to be made to ensurethat filers are designated the most appropriate principal regulator.

In the final sentence of the section, one commenter suggested adding the followingsentence: "If the application is denied, the relevant Canadian securities regulatoryauthorities will provide written reasons for the denial to the filer".

The CSA agree with the comment and the National Policy has been amended accordingly.

Section 4.1 [4.2] - Election of MRRS and Identifying Principal Regulator

One commenter thought that it should not be necessary to indicate the basis fordetermining the principal regulator in the SEDAR cover page information. The commentersuggested that in the unusual circumstances where there is any question, the filer couldbe asked to provide an explanation.

The CSA believe that it is administratively efficient for information relevant to determiningthe principal regulator to be included in the SEDAR. The National Policy has beenamended to require the information in the SEDAR filer profile instead of in the SEDARcover page information.

Section 4.2 [4.3]- Filing

Pursuant to section 4.2, a filing must be made with the principal regulator whether or notsecurities are proposed to be distributed to purchasers in that jurisdiction. According toone commenter, the fees payable on filing a final prospectus in Quebec are not adjustedbased on the proceeds realized in the province as in the other jurisdictions. Consequently,the commenter suggested that the fees in Quebec be paid on the same basis as for a non-offering prospectus.

The National Policy states that where a filer proposes to offer its securities by prospectusonly to purchasers in jurisdictions other than the jurisdiction in which the principal regulatoris located, the materials must also be filed with the principal regulator and will be reviewedby the principal regulator. The CSA is aware that there are issues with the general feestructure in a number of CSA jurisdictions and regulatory fees are already the subject ofserious consideration by the individual CSA members and by the CSA as a whole.

The National Policy requires a filer to submit materials, including fees, to its principalregulator regardless of whether the filer intends to distribute securities to purchasers inthat jurisdiction. The commenter disagreed with this provision, felt that it would deter filersfrom using the MRRS and found it curious that the principal regulator would conduct thereview and issue the MRRS decision document even though no securities were beingdistributed to purchasers in its jurisdiction.

The CSA believe that it is integral to the MRRS, in order to achieve the benefits ofconsistency and familiarity created by the MRRS, that all prospectuses are filed with theprincipal regulator regardless of whether or not securities are being distributed topurchasers in that jurisdiction.

Section 4.3 [4.4] - Black-lined Document

According to one commenter, the requirement to file an interim black-lined prospectus inFrench as well as English is new and a significant deviation from standard practice. Asthe black-lined prospectus is an attachment to a response letter to a comment letter, andas both the comment letter and the response letter are in English, the commenter thoughtthat there was no rationale for requiring the enclosure to be translated. Consequently, thecommenter recommended deleting this requirement.

Section 4.3 is based on paragraph (h) of Part 1 of NPS1. As a result of the comment,section 4.3 has been amended to clarify that, while filing a blackline at this stage is notrequired, it is recommended.

Part 5 - Review of Materials

One commenter noted that Part 5 does not specify how the filer receives or responds tocomments that non-principal regulators may make. This commenter suggested amendingthe National Policy to ensure that the filer would receive early advice of any potential opt-out issues so that the filer can avoid opt-outs if possible.

The CSA note that comments from non-principal regulators are communicated to filers inone of two ways. Either the comment of the non-principal regulator is communicated to thefiler in a comment letter from the principal regulator, in which case the filer responds to theprincipal regulator, or the non-principal regulator opts out of the MRRS for the filing andcommunicates directly with the filer, in which case the filer responds to the non-principalregulator. The CSA determined that Part 5 of the National Policy is clear and that noamendments are required.

Section 5.3 - Review Period for Short Form Prospectuses

One commenter thought that extending a short form review timetable to a long formtimetable for complex offerings was a significant change from current practice which couldhave dramatic negative implications for bought deals. The commenter recommendedreplacing the words "the time periods applicable to long form prospectuses" in the lastparagraph with the words "a longer time period may apply". Further, the commentersuggested deleting the words "use its best efforts to" in the final paragraph. If a principalregulator decides to deny the short-form review timing to an issuer, the commenterthought that notice should be given the next working day.

The CSA note that both the Expedited Review MOU and NPS 1 provide that the expeditedor short form review periods apply unless the reviewing regulator believes that theproposed offering is too complex to be reviewed adequately within the shortened timeframe in which case long form review periods apply. The CSA note that the ExpeditedReview MOU does not qualify the obligation of the regulator by only requiring it to use its"best efforts". Consequently, the CSA have considered the comment and have deleted the"best efforts" qualification in section 5.3 of the National Policy.

Part 6 - Opting Out

One commenter felt that it was necessary to impose temporal and other limits on theopting out process. The commenter suggested that: (1) non-principal regulators not beable to opt out before the principal regulator issues its comment letter; thereafter, theyonly be able to opt out within a prescribed time period; and (2) reasons for opting outgenerally be available to the public.

The CSA disagree with these comments. In order to retain statutory discretion with respectto filings, it is fundamental to the MRRS that non-principal regulators be entitled to opt outof the MRRS for a specific filing at any point in the review process.

With respect to the comment that reasons for opting out should be provided to the public,the CSA disagree. The MRRS does not change the information on the public record.Comments and responses to comments are not public information. It should be noted thatthe non-principal regulator's opt out status will not be made public unless the non-principalregulator ultimately refuses to issue a receipt.

One commenter inferred from the request for comment that selection and acceptance ofthe principal regulator will substantially resolve the issues related to differing filingscurrently required by provinces. However, if non-principal regulators either "opt out", ordecide to issue their own decision documents that revert back to their own filingrequirements, the commenter was concerned that the consistency that is sought would belost.

As indicated above, filers participating in the MRRS will be required to comply with thesecurities legislation and directions of each of the jurisdictions in which a distribution isbeing made whether or not the non-principal regulators have opted out. Consequently,neither the designation of a principal regulator nor the ability of non-principal regulators toopt out have the impact the commenter has ascribed to them.

Section 7.2 - Conditions to Issuance of Preliminary MRRS Decision Document

(i) General

One commenter suggested that the CSA modernize the Canadian system for issuingpreliminary prospectus receipts. The commenter noted that in many other jurisdictions,most notably the United States, preliminary materials are filed with the regulator and the'receipt' comprises a stamp indicating that the filer's documents have been delivered.Marketing efforts could generally start as soon as filing is complete. By contrast, in someCanadian jurisdictions, no receipt is issued (and thus clients are advised that marketingin Canada cannot begin) until a clerical level review is complete and staff is satisfied thatacceptable materials have been filed. In the commenter's experience, most commentsraised at this stage are not substantive and should not delay issuance of a receipt andthat this process caused unnecessary uncertainty and difficulties in integrating Canadianoffering procedures with those in other jurisdictions. For these reasons, the commenterrecommended deleting section 7.2.

The CSA note the comment. Staff of several CSA jurisdictions have been working toharmonize requirements to reduce the circumstances leading to delay in issuingpreliminary receipts. This, together with the confirmations required in subsection 7.2(2),should address unnecessary delays.

(ii) Subsection 7.2(2)

One commenter was concerned that when subsection 7.2(2) is read with Appendix A,"materials" will include a French language translation of the preliminary prospectus. Thecommenter submitted that traditionally in a long form offering a French languagetranslation of the preliminary prospectus was filed within a few days of the filing in theprincipal jurisdiction, as it is difficult if not impossible for the translators to remain currentwith what are often extensive last-minute changes to the prospectus. The commenteracknowledged that the offering may not be marketed in Quebec until the French languageversion is filed and the receipt obtained from the CVMQ, but argued that marketingactivities elsewhere in Canada should not be required to wait for the translation to becompleted. The commenter noted that practical issues relating to translating wereencountered in Spring 1998, when the CVMQ routinely had to extend the date for filingFrench language translations due to the volume of filings. For these reasons (if thecomment under "(i) General" above is not accepted) the commenter recommendeddeleting subsection 7.2(2) or, at a minimum, amending it to clarify that the decisiondocument will not be held up until the French language translation has been filed.

The CSA disagree with this comment. Under the MRRS, a preliminary MRRS decisiondocument will not be issued until acceptable materials have been filed. If a Frenchlanguage translation is required by a jurisdiction in which the filing is being made, thepreliminary MRRS decision document will not be issued until the French languagetranslation is filed. Clause 7.2(2)(a) has been amended to clarify that all requiredtranslations must be filed prior to the issuance of a MRRS decision document.

In reference to the comment that the CVMQ routinely extends the date for filingtranslations, the CSA note that, while the French language version of the preliminaryprospectus is usually filed with the English language version, the CVMQ has grantedexemptions from filing the French language translation of documents incorporated byreference (and not the French language translation of the preliminary prospectus itself) atthe time of the filing preliminary materials on the condition that those documents are filedat the time of filing the final prospectus.

The commenter has assumed that non-principal regulators cannot opt out of the MRRSbefore issuance of the comment letter of the principal regulator and therefore suggesteddeleting the words "... that have not opted out of the MRRS for the materials".

The CSA disagree with this comment. A non-principal regulator may opt out of the MRRSfor a filing prior to the issuance of the comment letter of the principal regulator. See theCSA response under Part 6 - "Opting out" above.

Section 7.4 - Conditions to Issuance of Final MRRS Decision Document for Long FormProspectus, Renewal Shelf Prospectus and Initial AIF

(i) Subsection 7.4(1)

One commenter suggested that the National Policy clarify whether the term "statutorywaiting period" referred to the period in subsection 65(1) of the Securities Act (Ontario)or the period in subsection 71(2) of the Securities Act (Ontario).

In response to the comment, the National Policy has been amended to clarify that, whereapplicable, "statutory waiting period" means the interval, which shall be at least ten days,between the issuance of a MRRS decision document for preliminary materials and finalmaterials.

(ii) Subsection 7.4(2)

Subsection 7.4(2) indicates that all non-principal regulators must indicate in the SEDAR"Filing Status" screen that they are "Clear for Final" or opt out of the MRRS for the filingbefore a final MRRS decision document can be issued. The commenter thought that adefault provision was required and that non-principal regulators should be deemed to beclear for final unless they have opted out within a specified time frame.

The CSA does not agree that a general default provision is appropriate as it isfundamental to the MRRS that non-principal regulators continue to exercise their discretionunder the system and that any pending applications have been resolved (either throughdiscretionary relief or otherwise) prior to the issuance of the MRRS decision document.The CSA agree, however, that it is not practical to require all non-principal regulators thathave not opted out to indicate that they are "Clear for Final" before the principal regulatorissues a final MRRS decision document. Consequently, the National Policy has beenamended so that the regulators in New Brunswick, Prince Edward Island, the YukonTerritory, the Northwest Territories and Nunavut are deemed to be clear for final unlessthey opt out.

(iii) Subsections 7.4(4)

Given SEDAR, one commenter felt that confirmation of filing in all relevant jurisdictionsshould not be a condition to issuance of a MRRS decision document (unless the filing isnot made through SEDAR).

The CSA believe that the requirement for confirmation of filing is administratively efficientand therefore have not made any changes to the National Policy.

Another commenter recommended deleting these requirements. The commenter wasconcerned how, on a practical level, a reporting issuer could give these assurances.Further, no such assurances are required under the Expedited Review System, where oneprovince issues a receipt for and on behalf of other provinces. Similarly, the commenterrecommended deleting the parallel requirement in subsection 7.2(3).

The CSA believe that determining that all required filings have been made is appropriatelythe responsibility of the filer and its advisers and, consequently, have not made thesuggested change to the National Policy. The CSA note that under the Expedited ReviewSystem and MRRS, while the principal regulator issues a document evidencing that areceipt has been issued in all jurisdictions, the principal regulator does not issue a receipton behalf of any other regulator or securities regulatory authority.

Section 7.8 - Material Issues Raised Late

Three commenters were concerned with the deemed opt-out presently in section 7.8.

One commenter felt that the deemed opt out is inconsistent with the goal of increasingadministrative efficiency in the review process and reducing the burden of dealing withnumerous regulators that filers currently face. The commenter recommended deleting theconcept of a deemed opt-out on the basis that the role of the principal regulator incoordinating and centralizing the views of the non-principal regulators was crucial wherethe late material issue is controversial.

Another commenter recommended reversing the deeming provision so that non-principalregulators that fail to provide reconfirmation within a stipulated time are deemed to beclear for final unless they have opted out.

A third commenter recommended amending this section to set a more reasonable balancebetween the principles of regulatory flexibility and certainty for filers as follows: (1)"material issues" can only be raised by the filer or the principal regulator; (2) the principalregulator must first notify the filer of the new material issue, and attempt to resolve it withthe filer, before asking for reconfirmation; (3) the filer should be permitted to provide awritten submission (through SEDAR) on the new material issue at the same time as theprincipal regulator asks for reconfirmation; (4) the responsibility to ensure that the non-principal regulators respond to the reconfirmation request should not lie with the filer; (5)after a reconfirmation request, non-principal regulators should have a prescribed timeperiod during which they may opt out of the MRRS; and (6) silence on the part of any non-principal regulator should mean that it is (i) not opting out of the MRRS and (ii) deemedto have reconfirmed that it is "Clear for Final".

In addition, one commenter recommended amending section 7.8 to specify the delayswithin which reconfirmation would be requested.

The CSA acknowledge that it would undermine the efficacy of the National Policy ifmaterial issues were raised late frequently. The CSA do not believe that this will occursince it was implicit in the 1998 Publication Drafts that late material issues could only bepotential receipt refusal issues that the principal regulator raised as a result of its reviewof the file or that the filer created as a result of changes the filer made after a non-principalregulator is clear for final. The National Policy has been amended by adding a definitionof "material issue" for the purpose of section 7.8 of the National Policy that includes thelimitations described above.

While three commenters expressed concern with the deemed opt out provision, theNational Policy continues to require the non-principal regulators to reconfirm. The CSAnote that the regulators in New Brunswick, Prince Edward Island, the Yukon Territory, theNorthwest Territories and Nunavut are not required to reconfirm. This is consistent withchanges made to section 7.4 of the National Policy. The CSA agree that it is necessaryto specify how long a reconfirmation request should be left open before silence is takento signify that a non-principal regulator has opted out. Consequently, the National Policyhas been amended to provide that a non-principal regulator that does not provide writtenreconfirmation within five days is considered to have opted out of the MRRS for the filing.

Section 9.1 - Pre-Filings and Waiver Applications - General

One commenter felt that, in a situation where a pre-filing or waiver application is beingmade to more than one non-principal regulator but not to the principal regulator, a filershould be able to submit one set of materials and identify and deal with one of the non-principal regulators as the 'lead regulator'.

The CSA have considered the comment and have amended section 9.1 of the NationalPolicy to provide that if the filer does not require exemptive relief in the jurisdiction of itsprincipal regulator, the filer should select the participating principal regulator in thejurisdiction with which the filer has the next most significant connection to act as theprincipal regulator for the purposes of the pre-filing or waiver application.

Further, the commenter was concerned about the requirement to obtain all waivers, andadvise the principal regulator of having done so, before a decision document is issued.For example, the waiver relief in respect of a listing representation is always evidencedby the granting of a receipt. Now, a separate application and document will be requiredand will have to be filed with each jurisdiction since the Securities Act (Ontario) is to beamended to delete this requirement. The commenter thought that this result was notefficient or user friendly and was a deviation from current practice.

The CSA note the comment. Generally, the CSA believe that it is appropriate for a filer toindicate to the principal regulator that it has obtained all necessary waivers. Specificallywith respect to listing representations, the CSA note that, in connection with the ExpeditedReview MOU, a number of jurisdictions issued a blanket permission to make listingrepresentations. The permissions allow listing representations to be made in preliminaryprospectuses filed in more than one jurisdiction under the Expedited Review MOU. VariousCSA jurisdictions will consider whether similar permissions will be issued to facilitate theuse of the MRRS.

Subsection 9.3 - Procedure for Novel and Substantive Pre-Filings and WaiverApplications

One commenter thought that the time-line for processing these applications did not createthe most efficient structure to ensure the swiftest treatment. The commenter concludedthat the communication of the principal regulator's intended treatment of the applicationis subordinate to and follows the prior issuance of the comments of the non-principalregulators upon the expiry of the delays mentioned as paragraph 9.3(b). The commenterfelt that this structure created an unnecessary overlap with the delays mentioned atparagraph 9.3(b), since communication of the principal regulator's intended treatment ofthe application engenders further unspecified delays to allow the non-principal regulatorsto object. The commenter recommended imposing the five business day delay ofsubsection 9.3(b) upon the principal regulator. The intervention of non-principalregulators would then be preserved through their opportunity to object within a reasonablespecified delay following the principal regulator's determination.

Another commenter suggested imposing prescribed time periods for: (1) the principalregulator to decide whether an application raises novel or complex issues (three days);(2) the principal regulator to notify the non-principal regulators of its proposed disposition(seven working days from the date of the filing in the case of a long form prospectus); and(3) the non-principal regulators to register any disagreement with the proposed disposition(two working days, rather than "a reasonable period of time", from the date of the noticeof proposed disposition). In the case of a disagreement, the commenter suggested thata non-principal regulator (and perhaps the principal regulator) consult with the filer in anattempt to resolve the issue without any non-principal regulator having to opt out of aparticular pre-filing or waiver application.

The CSA disagree with these comments. Currently, there are no time lines imposed on thereview of pre-filing or waiver applications and the review is not coordinated amongst thevarious jurisdictions in which the distribution will eventually be made. Consequently, theCSA are of the view that the mechanism for reviewing pre-filings and waiver applicationsin the National Policy is an improvement over the current system and have not made anychanges to the National Policy to address these comments.

Section 10.1- Filing of Amendments

One commenter noted that subsection 10.1(2) [10.1(b)] appears to inadvertently introduceinto the securities legislation of other provinces a requirement unique to Quebec. Inprovinces where amendments do not require a receipt it is not necessary to ceasedistribution after the amendment is filed. The commenter presumed that subsection10.1(2) [10.1(b)] was meant to apply only to Quebec (ie. the undertaking was only madeto the CVMQ) and recommended clarifying the drafting.

The CSA agree that the undertaking is only required to be made to the CVMQ and onlypertains to distributions in Quebec and the National Policy has been amended accordingly.This change does not, however, alter securities legislation and directions in certainjurisdictions in Canada (referred to in section 10.9 of the National Policy) which prohibit afiler from proceeding with a distribution or additional distribution until a receipt for aprospectus amendment is issued.

Section 10.2 - Conditions to Issuance of MRRS Decision Document for PreliminaryProspectus Amendments

One commenter recommended deleting subsections 10.2(1), (2) and (3) of the 1998Publication Drafts.

See the CSA response above under the heading "Section 7.2 - Conditions to Issuance ofPreliminary MRRS Decision Document".

Section 10.4 - Review Period for Preliminary Prospectus Amendments

One commenter thought that it was appropriate for regulators to be subject to reasonabletime limits in reviewing preliminary prospectus amendments and suggested that anamendment result in 'resetting' certain time limits. In particular, the commenter suggestedthat: (1) in subsection 10.4(1), for an amendment filed prior to issuance of the commentletter, provide that the principal regulator has another five working days from the originaldue date to issue its comment letter; (2) in subsections 10.4(2) and (3), delete allreferences to "best efforts"; and (3) in subsection 10.4(4), restrict the circumstances inwhich the time periods in subsections 10.4(2) and (3) may not apply.

The CSA agree that if an amendment is filed before the issuance of the first commentletter, the comments of the principal regulator should be due on the later of the date thatis five working days after the filing of the amendment and the original due date for thecomment letter. The National Policy has been amended accordingly. The CSA does not,however, agree with the suggestion to delete all references to "best efforts" or to imposefurther time lines on the process.

Section 10.7 - Form of Prospectus Amendment MRRS Decision Document

One commenter was concerned that section 10.7 merely described a problem that shouldbe resolved through the MRRS. The commenter suggested harmonizing the differentadministrative practices relating to receipts for amendments, and imposing a uniformsystem on market participants.

The CSA note that whether or not a receipt is issued for an amendment to a preliminaryprospectus is the result of different legislative requirements not different administrativepractices. Consequently, harmonizing these requirements is beyond the scope of thisproject.

Appendix A

One commenter was disappointed with the proposed materials because they indicated alimited commitment to streamlining securities regulation throughout Canada anddeveloping consistent legislation in each of the provinces. The commenter felt that it wasinefficient for market participants to keep track of the different rules, policies and feeschedules in force from time to time in the various jurisdictions.

One commenter was of the view that several requirements in Appendix A were notconsistent with the general objective of the National Policy. The commenteracknowledged that some single-jurisdiction requirements correspond to specific legislationthat is not within the purview of the CSA (e.g., in Ontario, to comply with the Freedom ofInformation and Protection of Privacy Act), and the commenter accepted that theseanomalies would have to remain. However, the commenter believed that the CSA shoulddevelop a uniform approach when specific requirements imposed by certain jurisdictionsare not consistent with the requirements in the majority of jurisdictions.

The CSA understand that for filings made in more than one Canadian jurisdiction therewould be significant benefits from harmonizing the documents that need to be filed. Whileharmonization is beyond the scope of this project, these requirements are currently beingreviewed in the context of long form filings (in Ontario, proposed Rule 41-501 GeneralProspectus Requirements), short form filings (proposed NI 44-101 Short Form ProspectusDistributions) and mutual fund filings (NI 81-101 Mutual Fund Prospectus Disclosure). TheCSA intend to make conforming changes to Appendix A so that it reflects the revisionsmade to the documents required to be filed in the context of long form, short form andmutual fund filings when the national instruments or rules referred to above are finalized.In addition, the CSA intends to make conforming changes to Appendix A to the NationalPolicy when, through ongoing discussions on harmonization, the CSA jurisdictions agreeon a particular uniform filing requirement.

NATIONAL POLICY 43- 201

MUTUAL RELIANCE REVIEW SYSTEM FOR

PROSPECTUSES AND ANNUAL INFORMATION FORMS

TABLE OF CONTENTS

 

PART    TITLE

PART 1 OVERVIEW AND APPLICATION

1.1 Scope
1.2 Objective
1.3 Application of Local Requirements

PART 2 DEFINITIONS AND INTERPRETATION

2.1 Definitions
2.2 Interpretation

PART 3 PRINCIPAL REGULATOR

3.1 Participating Principal Regulators
3.2 Determination of Principal Regulator
3.3 Automatic Change of Principal Regulator
3.4 Discretionary Change of Principal Regulator Applied for by Filer
3.5 Discretionary Change of Principal Regulator Proposed by the Participating Regulators
3.6 Notification to CSA Committee of Discretionary Change of Principal Regulator
3.7 Effect of Change of Principal Regulator
3.8 Identification of New Principal Regulator

PART 4 FILING MATERIALS UNDER THE MRRS

4.1 Election of MRRS and Identifying Principal Regulator
4.2 Filing
4.3 Black-lined Document
4.4 Seasoned Prospectuses

PART 5 REVIEW OF MATERIALS

5.1 Review by Principal Regulator
5.2 Review Period for Long Form Prospectuses, Renewal Shelf Prospectuses and Initial AIFs
5.3 Review Period for Short Form Prospectuses
5.4 Form of Response
5.5 Review of Renewal AIFs

PART 6 OPTING OUT

6.1 Opting Out
6.2 Opting Back In

PART 7 MRRS DECISION DOCUMENT

7.1 Effect of MRRS Decision Document
7.2 Conditions to Issuance of Preliminary MRRS Decision Document
7.3 Form of Preliminary MRRS Decision Document
7.4 Conditions to Issuance of Final MRRS Decision Document for Long Form Prospectuses, Renewal Shelf Prospectuses and Initial AIFs
7.5 Conditions to Issuance of Final MRRS Decision Document for Short Form Prospectuses
7.6 Form of Final MRRS Decision Document
7.7 Local Decision Document
7.8 Material Issues Raised Late
7.9 Refusal by Principal Regulator to Issue Receipt or Notice of Acceptance
7.10 Right to be Heard Following a Refusal

PART 8 APPLICATIONS

8.1 Applications

PART 9 PRE-FILINGS AND WAIVER APPLICATIONS

9.1 General
9.2 Procedure for Routine Pre-Filings and Waiver Applications
9.3 Procedure for Novel and Substantive Pre-Filings and Waiver Applications
9.4 Filing of Related Materials
9.5 Effect of Related MRRS Decision Document

PART 10 AMENDMENTS

10.1 Filing of Amendments
10.2 Conditions to Issuance of MRRS Decision Document for Preliminary Prospectus Amendments
10.3 Form of MRRS Decision Document for Preliminary Prospectus Amendments
10.4 Review Period for Preliminary Prospectus Amendments
10.5 Review Period for Prospectus Amendments
10.6 Conditions to Issuance of Prospectus Amendment MRRS Decision Document
10.7 Form of Prospectus Amendment MRRS Decision Document
10.8 Local Decision Document
10.9 Other Requirements

 

NATIONAL POLICY 43- 201

 

MUTUAL RELIANCE REVIEW SYSTEM FOR PROSPECTUSES AND ANNUAL INFORMATION FORMS

PART 1 OVERVIEW AND APPLICATION

1.1 Scope - This Policy describes the practical application of mutual relianceconcepts set out in the MRRS MOU relating to the filing and review ofprospectuses, including mutual fund and shelf prospectuses, amendmentsto prospectuses, annual information forms and related materials.

1.2 Objective - Under the MRRS, a designated securities regulatory authorityor regulator, as applicable, acts as the principal regulator for all materialsrelating to a filer. This will enable participating principal regulators todevelop greater familiarity with their respective filers, which will enhance theefficiency and quality of their review of materials filed under the MRRS.

1.3 Application of Local Requirements - Although the filer will generally dealonly with its principal regulator in connection with materials filed under theMRRS, the local securities legislation and local securities directions in eachjurisdiction in which the materials are filed are applicable to the materials.

PART 2 DEFINITIONS AND INTERPRETATION

2.1 Definitions - In this Policy,

"amendment" means an amendment to a preliminary prospectus or prospectus;

"application" means a request for discretionary relief from or approval under securitieslegislation or securities directions, but does not include a waiver application or pre-filing;

"applications policy" means National Policy 12-201 Mutual Reliance Review System forExemptive Relief Applications;

"CSA committee" means the Mutual Reliance Review System Committee of the CanadianSecurities Administrators;

"initial AIF" means an annual information form filed by a filer in order to qualify for theShort Form Prospectus system;

"local securities directions" means, for the local jurisdiction, the instruments listed inAppendix A of National Instrument 14-101 Definitions opposite the name of the localjurisdiction;

"local securities legislation" means, for the local jurisdiction, the statute and otherinstruments listed in Appendix B of National Instrument 14-101 Definitions opposite thename of the local jurisdiction;

"local securities regulatory authority" means, for the local jurisdiction, the securitiescommission or similar regulatory authority listed in Appendix C of National Instrument 14-101 Definitions opposite the name of the local jurisdiction;

"long form prospectus" includes a simplified prospectus and annual information form fora mutual fund;

"materials" means the documents and fees referred to in Appendix A to this Policy, asamended from time to time, for each category of filing;

"MRRS MOU" means the Memorandum of Understanding relating to the Mutual RelianceReview System signed as of October 14, 1999;

"NPS 36" means National Policy Statement No. 36 Mutual Funds: Simplified ProspectusQualification System, or its successor instrument, National Instrument 81-101 MutualFund Prospectus Disclosure;

"NPS 39" means National Policy Statement No. 39 Mutual Funds, or its successorinstrument, National Instrument 81-102 Mutual Funds;

"pre-filing" means a consultation with one or more of the securities regulatory authoritiesregarding the interpretation or application of securities legislation or securities directionsto a particular transaction or proposed transaction that is the subject of, or is referred toin, materials, if the consultation is initiated before the filing of those materials;

"preliminary prospectus amendment" means an amendment to a preliminary prospectus;

"preliminary prospectus amendment MRRS decision document" means a MRRS decisiondocument issued for a preliminary prospectus amendment;

"prospectus amendment" means an amendment to a prospectus;

"prospectus amendment MRRS decision document" means a MRRS decision documentissued for a prospectus amendment;

"renewal AIF" means an annual information form that is not an initial AIF, filed by a filerin order to continue to qualify for the Short Form Prospectus system;

"renewal shelf prospectus" means a short form prospectus that is prepared and filed inaccordance with the Shelf Prospectus system to replace a short form prospectuspreviously filed by the issuer under the Shelf Prospectus system for which a final receiptor final MRRS decision document was issued;

"requested regulator" means a participating principal regulator, other than the principalregulator determined in accordance with section 3.2, which a filer requests undersubsection 3.4 to act as its principal regulator;

"seasoned prospectus" means a pro forma or preliminary prospectus of an issuer, if it isfiled within two years of the date that a final MRRS decision document, or receipt, wasissued to the issuer for a prospectus;

"securities directions" means the instruments listed in Appendix A of National Instrument14-101 Definitions;

"securities legislation" means the statutes and other instruments listed in Appendix B ofNational Instrument 14-101 Definitions;

"securities regulatory authorities" means the securities commissions and similar regulatoryauthorities listed in Appendix C of National Instrument 14-101 Definitions;

"SEDAR" has the meaning ascribed to that term in National Instrument 13-101 System forElectronic Document Analysis and Retrieval;

"Shelf Prospectus system" means the system for the distribution of securities under a shelfprospectus as contemplated in National Policy Statement No. 44 Rules for ShelfProspectus Offerings and for Pricing Offerings After the Final Prospectus is Receipted,or any successor instrument, and the provisions of the Securities Act (Quebec) and itsRegulation concerning securities applicable to the shelf prospectus distribution system;

"Short Form Prospectus system" means the system for the distribution of securities ascontemplated in National Policy Statement No. 47 Prompt Offering Qualification System,or any successor instrument, and the provisions of the Securities Act (Québec) and itsRegulation concerning securities applicable to the short form prospectus distributionsystem; and

"waiver application" means a request for discretionary relief from securities legislation orsecurities directions, if the relief, if granted, would be evidenced by the issuance of aMRRS decision document under this Policy.

2.2 Interpretation - Unless otherwise defined herein, terms used in the Policythat are defined or interpreted in the MRRS MOU should be read inaccordance with the MRRS MOU.

PART 3 PRINCIPAL REGULATOR

3.1 Participating Principal Regulators - As of the date of this Policy, thesecurities regulatory authorities of British Columbia, Alberta, Saskatchewan,Manitoba, Ontario, Québec and Nova Scotia have agreed to act as principalregulator for materials filed under this Policy.

3.2 Determination of Principal Regulator

(1) It is the responsibility of the filer to determine its principal regulator.Unless changed or redesignated under section 3.3, 3.4 or 3.5, theprincipal regulator for a filer is determined in accordance with thefollowing criteria:

(a) For filers, other than mutual funds, whose head office is in ajurisdiction in which a participating principal regulator islocated, the principal regulator is the local securitiesregulatory authority or regulator in the jurisdiction in which thehead office is located.

(b) For filers, other than mutual funds, whose head office is not ina jurisdiction in which a participating principal regulator islocated, the filer can select a participating principal regulatoras its principal regulator, if the filer has a reasonableconnection with the jurisidiction in which the selected principalregulator is located.

(c) For filers that are mutual funds whose manager's head officeis in a jurisdiction in which a participating principal regulatoris located, the principal regulator is the local securitiesregulatory authority or regulator in the jurisdiction in which themanager's head office is located.

(d) For filers that are mutual funds whose manager's head officeis not in a jurisdiction in which a participating principalregulator is located, the filer can select a participatingprincipal regulator as its principal regulator, if the filer has areasonable connection with the jurisdiction in which theselected principal regulator is located.

(2) For a particular filing of materials, if the filer has incorrectly identifieda non-principal regulator as the principal regulator, that non-principalregulator will decline to act as principal regulator and will notify thefiler.

(3) The principal regulator determined in accordance with section 3.2 isthe principal regulator for all materials filed under this Policy unlessthe principal regulator has been changed under section 3.3, 3.4 or3.5.

3.3 Automatic Change of Principal Regulator - If the location of the headoffice of the filer or in the case of a mutual fund, the manager, is changedafter the determination of the principal regulator in accordance with section3.2, the principal regulator will change automatically to the local securitiesregulatory authority or regulator in the jurisdiction to which the head officehas been moved if the new head office is in a jurisdiction in which aparticipating principal regulator is located. In all other circumstances theprincipal regulator can only be changed in accordance with section 3.4 or3.5.

3.4 Discretionary Change of Principal Regulator Applied for by Filer

(1) A filer may apply for a change of principal regulator if it believes thatits principal regulator is not the appropriate principal regulator.However, a change of a filer's principal regulator based on factorsother than the head office criteria set out in section 3.2 will generallynot be permitted unless exceptional circumstances justify the change.The factors that may be considered in assessing an application fora change of a filer's principal regulator include

(a) location of management,

(b) location of assets and operations, and

(c) location of filer's trading market or quotation system inCanada, or, if the filer's securities are not traded or quoted ona trading market or quotation system in Canada, location offiler's securityholders.

(2) If a filer applies for a change of its principal regulator, the applicationshould be submitted in paper form to the principal regulator and therequested regulator at least thirty days in advance of any filing ofmaterials under this Policy to permit adequate time for staff of therelevant securities regulatory authorities to consider and resolve theapplication. If the application is not resolved before the date of anyfiling of materials, the principal regulator will continue to act asprincipal regulator for that filing, and the change requested, ifgranted, will relate to materials filed after the issuance of the finalMRRS decision document.

(3) The application should address the basis for the designation of thefiler's principal regulator in accordance with section 3.2, and shouldset forth the reasons for the requested regulator to act as principalregulator with regard to the factors specified in subsection (1) andany other relevant factors. The filer will be given an opportunity torespond to concerns or comments raised by the relevant securitiesregulatory authorities.

(4) If an application is denied, the principal regulator will provide writtenreasons for the denial to the filer.

3.5 Discretionary Change of Principal Regulator Proposed by theParticipating Principal Regulators

(1) The participating principal regulators may determine that it would bepreferable for a participating principal regulator other than thesecurities regulatory authority acting as principal regulator to act asa filer's principal regulator. This determination will generally only bemade if changing the principal regulator of a filer would result ingreater administrative and regulatory efficiencies with regard to thefactors specified in subsection 3.4(1) and other relevant factors. Theparticipating principal regulators will not redesignate a filer's principalregulator after materials have been filed and before a final MRRSdecision document has been issued for the materials.

(2) If the participating principal regulators propose to change a filer'sprincipal regulator, the principal regulator will notify the filer in writingof the proposed change, and will identify the reasons for theproposed change. The redesignated principal regulator will becomethe filer's principal regulator thirty days after the date of the noticeunless the filer objects in writing to the proposed change. The filer,the principal regulator and the proposed principal regulator willattempt to resolve any objections raised by the filer to the proposedchange.

3.6 Notification to CSA Committee of Discretionary Change of PrincipalRegulator - The participating principal regulators involved in an applicationor proposal to change a filer's principal regulator will advise the CSAcommittee of all decisions rendered under sections 3.4 or 3.5 and thereasons for the decisions.

3.7 Effect of Change of Principal Regulator

(1) A change of principal regulator under section 3.3, 3.4 or 3.5 appliesfor all materials filed under this Policy after the change.

 

(2) If the circumstances relevant to the determination of the principalregulator change after the date of any filing of materials and beforea final MRRS decision document is issued relating to those materials,the principal regulator will act as principal regulator for that filing, andthe change of principal regulator will relate to materials filed after theissuance of the final MRRS decision document.

3.8 Identification of New Principal Regulator - At the time of the first filingfollowing a change of principal regulator, the filer should identify the newprincipal regulator in the cover page information for the SEDAR filing andindicate that this is a change from the previous filing. The filer should alsoupdate its SEDAR filer profile to identify the new principal regulator andinclude the basis for the change of principal regulator.

PART 4 FILING MATERIALS UNDER THE MRRS

4.1 Election of MRRS and Identifying Principal Regulator - The filer shouldindicate in the cover page information for the SEDAR filing its principalregulator and that it is electing to file materials under the MRRS. The filershould also identify its principal regulator and the basis for thedetermination in its SEDAR filer profile. If a filer's principal regulator isdetermined in accordance with paragraph 3.2(1)(b) or 3.2(1)(d), the filershould provide a description of the factors connecting the filer to thejurisdiction of the principal regulator it has selected. If applicable, the filershould provide the date of the change in circumstances resulting in anautomatic change of principal regulator under section 3.3 or of a decisionunder section 3.4 or 3.5 changing the principal regulator.

4.2 Filing - If a filer proposes to distribute its securities by prospectus only topurchasers in jurisdictions other than the jurisdiction in which its principalregulator is located, the materials, including the required fees, should alsobe filed with the principal regulator, and will be reviewed by the principalregulator. This will enable participating principal regulators to maintainfamiliarity with their respective filers.

4.3 Black-lined Document - Except in the case of short form prospectuses, itis strongly recommended that a filer file through SEDAR a draft prospectusor draft initial AIF (the French language version, in Quebec), black lined toshow changes, as far as possible in advance of filing final materials. Thisblack lined version is in addition to the black lined version of the finalprospectus or initial AIF to be filed with the final materials.

4.4 Seasoned Prospectuses

(1) If appropriate, a filer may identify a prospectus being filed as aseasoned prospectus. When a seasoned prospectus is filed itshould be accompanied by a copy of the seasoned prospectus blacklined against the preceding prospectus of the filer to show allchanges made. The prospectus should be accompanied by acertificate of the filer. The certificate should certify that the blacklined prospectus indicates all differences between the content of theseasoned prospectus and that of the previous prospectus of the filer.

(2) If a filing is made under this section, the principal regulator willadvise the non-principal regulators when the comment letter is issuedthat the prospectus is being reviewed as a seasoned prospectus.The non-principal regulators will then assume that the principalregulator has conducted only a limited review of the prospectusunless the contrary is specifically stated.

(3) The procedures set out in this section do not apply to filings madeunder NPS 36.

PART 5 REVIEW OF MATERIALS

5.1 Review by Principal Regulator - The principal regulator is responsible forreviewing all materials in accordance with the local securities legislation andlocal securities directions of the jurisdiction in which the principal regulatoris located, and in accordance with its review procedures, analysis andprecedents. The principal regulator will be responsible for issuing andresolving comments on materials and issuing the MRRS decision documentonce the relevant conditions have been satisfied. While the non-principalregulators may review the materials and will advise the principal regulatorof any material issues relating to the materials that, if left unresolved, wouldcause the non-principal regulators to opt out of the MRRS, the filer willgenerally deal solely with the principal regulator.

5.2 Review Period for Long Form Prospectuses, Renewal ShelfProspectuses and Initial AIFs

(1) A principal regulator that has implemented a system of selectivereview will, within three working days of the date of the preliminaryMRRS decision document or receipt of the initial AIF materials or thepro forma materials, notify the non-principal regulators of thedesignated level of review to be given to the materials, i.e. fullreview, issue-oriented review or basic review.

(2) If a principal regulator that has implemented a system of selectivereview selects materials for either full review or issue-orientedreview, or a principal regulator does not have a system of selectivereview, the principal regulator will use its best efforts to review thematerials and issue a comment letter within 10 working days of thedate of the preliminary MRRS decision document or receipt of theinitial AIF materials or the pro forma materials.

(3) Each non-principal regulator will, within five working days of the dateof receipt of the comment letter of the principal regulator, use its bestefforts to

(a) advise the principal regulator of any material concerns withthe materials that, if left unresolved, would cause the non-principal regulator to opt out of the MRRS; or

(b) indicate in the SEDAR "Filing Status" screen that it is clear toreceive final materials, if there are no outstanding applicationsor waiver applications that have been filed with the non-principal regulators.

(4) For materials that have been selected for basic review, the non-principal regulators will, within 6 working days of being notified thatthe materials have been selected for basic review, use their bestefforts to comply with paragraphs (3)(a) or (3)(b), as appropriate.

5.3 Review Period for Short Form Prospectuses

(1) The principal regulator will use its best efforts to review materialsrelating to a preliminary short form prospectus and issue a commentletter within three working days of the date of the preliminary MRRSdecision document. Each non-principal regulator will, by 12:00 noon,Eastern time, on the working day following the date of issuance ofthe comment letter of the principal regulator, use its best efforts to

(a) advise the principal regulator of any material concerns withthe materials that, if left unresolved, would cause the non-principal regulator to opt out of the MRRS; or

(b) indicate in the SEDAR "Filing Status" screen that it is clear toreceive final materials, if there are no outstanding applicationsthat have been filed with the non-principal regulators.

(2) Despite the foregoing, if, in the opinion of the principal regulator, aproposed distribution by way of short form prospectus is too complexto be reviewed adequately within the prescribed time periods, theprincipal regulator may determine that the time periods applicable tolong form prospectuses should apply, and the principal regulator will,within one working day of the filing of the preliminary short formprospectus, so notify the filer and the non-principal regulators. Thefiler is encouraged to submit a pre-filing to resolve any issues thatmay cause a delay in the prescribed time periods.

5.4 Form of Response - The filer should provide to the principal regulatorwritten responses to the comment letter issued by the principal regulator.

5.5 Review of Renewal AIFs

(1) A renewal AIF shall be filed with the principal regulator and non-principal regulators when it is deemed to be filed under NationalInstrument 13-101 System for Electronic Document Analysis andRetrieval.

(2) A renewal AIF may be reviewed by the principal regulator at any timeafter notice has been given. If the principal regulator decides toreview the renewal AIF, it will notify the filer and the non-principalregulators through SEDAR and by facsimile.

(3) Each non-principal regulator will, within five working days of the dateof the receipt of the comment letter of the principal regulator, use itsbest efforts to:

(a) advise the principal regulator of any material concerns withthe materials that, if left unresolved, would cause the non-principal regulator to opt out of the MRRS; or

(b) indicate in the SEDAR "Filing Status" screen that it is clear toreceive final materials.

(4) As soon as practicable after the review of the renewal AIF has beencompleted, the principal regulator will notify the filer that the reviewhas been completed by issuing a MRRS decision document. TheMRRS decision document will evidence that the review of therenewal AIF has been completed by the regulator in each jurisdictionin which the renewal AIF was filed and where the regulator has notopted out of the MRRS for the materials.

(5) A MRRS decision document will only be issued for those renewalAIFs that were subject to review and will contain the following legend:

This mutual reliance decision document evidences that reviews bythe regulators in each of (name of each jurisdiction in which materialshave been filed and where the regulator has not opted out of theMRRS for the materials) have been completed.

(6) If, after the principal regulator notifies the filer that its renewal AIF willbe reviewed and before the principal regulator has notified the issuerthat the review has been completed, the filer files a preliminary shortform prospectus, both the filer's preliminary short form prospectusand its renewal AIF will be reviewed at the same time in accordancewith the time limits applicable to the review of a short formprospectus. In that case, comments arising in the course of thereview of the renewal AIF will be taken into account during the reviewof the preliminary short form prospectus. The principal regulator willissue a notice that it has completed the review of the renewal AIFbefore, or concurrently with, issuing the final MRRS decisiondocument for the short form prospectus.

(7) A filer that intends to file a preliminary short form prospectus within10 days of filing its renewal AIF should notify the principal regulatorof this intention at the time of filing its renewal AIF or, if the decisionis not yet made at that time, then immediately upon making thedecision.

(8) If the principal regulator receives a notice of a filer's intention to filea preliminary short form prospectus, it will notify the filer as soon aspracticable if it intends to review the filer's renewal AIF. In that case,the filer's preliminary short form prospectus and its renewal AIF willbe reviewed in accordance with the procedures set out in subsection(6). The accelerated review procedure will not be extended to a filerif any of the securities regulatory authorities consider that the filerhas abused or is abusing the provision. For example, a localsecurities regulatory authority may consider it abusive if a filer givesnotice and no short form prospectus is filed.

PART 6 OPTING OUT

6.1 Opting Out - A non-principal regulator can opt out of the MRRS for a filingat any time before the principal regulator issues a final MRRS decisiondocument for the materials. The non-principal regulator will provide noticeof its decision to opt out to the filer, the principal regulator and the othernon-principal regulators by indicating "MRRS - Opt Out" in the SEDAR"Filing Status" screen. The non-principal regulator will at that time providewritten reasons for its decision to opt out of the MRRS to the filer. The non-principal regulator that has opted out will also advise the principal regulatorand the other non-principal regulators of its reasons for opting out. The filerwill deal directly with the non-principal regulator that has opted out toresolve any outstanding issues. Reasons for opting out will be forwarded tothe CSA committee.

6.2 Opting Back In - If the filer and the non-principal regulator are able toresolve their outstanding issues before the principal regulator issues thefinal MRRS decision document, the non-principal regulator may opt back into the MRRS by notifying the principal regulator, all other non-principalregulators and the filer by indicating "MRRS - Opt Back In - Clear for Final"in the SEDAR "Filing Status" screen.

PART 7 MRRS DECISION DOCUMENT

7.1 Effect of MRRS Decision Document - The MRRS decision documentevidences that a determination on materials has been made by the principalregulator and the non-principal regulators that have not opted out of theMRRS for the materials.

7.2 Conditions to Issuance of Preliminary MRRS Decision Document - Theprincipal regulator will issue a preliminary MRRS decision document if

 

1. the principal regulator has determined that acceptable materials havebeen filed;

2. the filer has confirmed to the principal regulator in a letteraccompanying the materials that:

(a) materials, including all required translations, have been filedwith all non-principal regulators that have not opted out of theMRRS for the materials,

(b) in respect of each jurisdiction in which the materials are filed,the filer has filed or delivered all documents required to befiled or delivered under the local securities legislation and isnot subject to a cease trade order issued by a local securitiesregulatory authority,

(c) in each jurisdiction in which the securities will be offered topurchasers, at least one underwriter that has signed thecertificate is registered, or has filed an application forregistration or an application for exemptive relief from therequirement to be registered. If none of the underwriters thathas signed the certificate are registered in a jurisdiction inwhich the distribution is being made but one of theunderwriters has filed an application for registration or anapplication for exemptive relief from the requirement to beregistered, that underwriter will file an undertaking with theprincipal regulator not to solicit in that jurisdiction until theregistration or exemption has been obtained, and

(d) in the case of distributions to be effected by the filer, the fileris registered in each jurisdiction in which the securities will beoffered to purchasers, or has filed an application forregistration. If the filer has filed an application for registrationin a jurisdiction, the filer shall file an undertaking with theprincipal regulator not to solicit in that jurisdiction until theregistration is obtained.

7.3 Form of Preliminary MRRS Decision Document - The preliminary MRRSdecision document for a preliminary prospectus will contain the followinglegend:

This preliminary mutual reliance review system decision documentevidences that preliminary receipts of the regulators in each of (name ofeach jurisdiction in which materials have been filed and where the regulatorhas not opted out of the MRRS for the materials) have been issued.

7.4 Conditions to Issuance of Final MRRS Decision Document for LongForm Prospectuses, Renewal Shelf Prospectuses and Initial AIFs - Theprincipal regulator will issue a final MRRS decision document for a long-form prospectus, a renewal shelf prospectus or an initial AIF if

1. the statutory waiting period, being the interval of at least ten days,between the issuance of a MRRS decision document for preliminarymaterials and final materials, if applicable, has expired;

2. all non-principal regulators, other than the regulators in NewBrunswick, Prince Edward Island, the Yukon Territory, the NorthwestTerritories and Nunavut, have indicated in the SEDAR "Filing Status"screen that they are "Clear for Final" or have opted out of the MRRSfor the filing by indicating "MRRS - Opt Out" in the SEDAR "FilingStatus" screen;

3. the principal regulator has determined that acceptable materials havebeen filed,

4. the filer has confirmed to the principal regulator in a letteraccompanying the materials that:

(a) materials, including all required translations, have been filedwith all non-principal regulators that have not opted out of theMRRS for the materials,

(b) in respect of each jurisdiction in which the materials are filed,the filer has filed or delivered all documents required to befiled or delivered under the local securities legislation and isnot subject to a cease trade order issued by a local securitiesregulatory authority,

(c) in each jurisdiction in which the securities will be offered topurchasers, at least one underwriter that has signed thecertificate is registered or has been exempted from therequirement to be registered;

(d) in the case of distributions to be effected by the filer, the fileris registered in each jurisdiction in which the securities will beoffered to purchasers; and

(e) except with respect to an initial AIF, all necessary relief fromapplicable securities legislation or securities directions hasbeen applied for and granted by the principal regulator andnon-principal regulators.

7.5 Conditions to Issuance of Final MRRS Decision Document for ShortForm Prospectuses - The principal regulator will issue a final MRRSdecision document for a short form prospectus if the conditions specified insection 7.4, other than subsection 7.4(1), have been met and at least twoworking days have elapsed from the date of the preliminary MRRS decisiondocument.

7.6 Form of Final MRRS Decision Document

(1) The final MRRS decision document for a prospectus will contain thefollowing legend:

This final mutual reliance review system decision documentevidences that final receipts of the regulators in each of (name ofeach jurisdiction in which materials have been filed and where theregulator has not opted out of the MRRS for the materials) have beenissued.

(2) The final MRRS decision document for an initial AIF will contain thefollowing legend:

This final mutual reliance review system decision documentevidences that notices of acceptance of the regulators in each of(name of each jurisdiction in which materials have been filed andwhere the regulator has not opted out of the MRRS for the materials)have been issued.

7.7 Local Decision Document - Despite the issuance of the MRRS decisiondocument, certain non-principal regulators will issue concurrently their owndecision documents for materials. In the case of materials filed for aproposed distribution of securities, it is not necessary for a filer to obtain acopy of the local decision document before commencing the distribution ofits securities.

7.8 Material Issues Raised Late

(1) "Material issue" means a potential receipt refusal issue raised by theprincipal regulator as a result of its review of the materials or raisedby the filer as a result of changes made by the filer after a non-principal regulator is clear for final.

(2) If a material issue is raised after a non-principal regulator hasindicated that it is clear for final, the principal regulator maydetermine that it is not prepared to issue a final MRRS decisiondocument unless such non-principal regulator providesreconfirmation that it is clear for final materials. The principalregulator will submit through SEDAR under "Memo to Regulators -Reconfirmation Requested" a letter identifying the new materialissue. The filer should encourage the non-principal regulators torespond to the correspondence of the principal regulator. A non-principal regulator, other than the regulators in New Brunswick,Prince Edward Island, the Yukon Territory, the Northwest Territoriesand Nunavut. that does not provide reconfirmation within five days isconsidered to have opted out of MRRS.

7.9 Refusal by Principal Regulator to Issue Receipt or Notice ofAcceptance

(1) If the principal regulator refuses to issue a receipt or notice ofacceptance, as the case may be, for materials and therefore refusesto issue a MRRS decision document, it will notify the filer and thenon-principal regulators by sending a refusal letter through SEDAR,and the MRRS will no longer apply to the filing. In thesecircumstances, the filer will deal separately with the local securitiesregulatory authority in each jurisdiction in which the materials werefiled, including the principal regulator, to determine if the localsecurities regulatory authority or regulator in those jurisdictions willissue a local decision document. Filers are cautioned that, once theMRRS is no longer applicable to the materials, each non-principalregulator may conduct its own comprehensive review of thematerials.

(2) To the extent the issues that gave rise to the refusal to issue aMRRS decision document are resolved to the satisfaction of allparties, the filer may request that the MRRS apply once again to thematerials.

7.10 Right to be Heard Following a Refusal - If a filer requests a hearing for arefusal by the principal regulator to issue a receipt, the principal regulatorwill promptly advise the non-principal regulators of the request. Theprincipal regulator will generally hold the hearing, either solely or togetherwith other interested non-principal regulators. The non-principal regulatorsmay make whatever arrangements they consider appropriate, includingconducting hearings.

PART 8 APPLICATIONS

8.1 Applications - In many instances, certain exemptive relief is required by afiler to enable a filing of materials or to facilitate a distribution of securitiesunder materials filed. The following guidelines may assist a filer in ensuringthat the review of materials is not unduly delayed if there is a concurrentapplication that is not subject to Part 9:

1. The principles of mutual reliance are available to govern the reviewand disposition of applications that are made in multiple jurisdictions.If the application is to be filed under the MRRS, it should be filedunder the applications policy.

2. If the relief requested in the application is a condition to the issuanceof a MRRS decision document and if the application is not filed in atimely manner, the issuance of the MRRS decision document may bedelayed. In this regard, if an application is filed under the MRRS,filers are referred to the time periods for processing applications ascontained in the applications policy.

3. If an application is filed, the filer should indicate in the SEDAR coverpage information for the related filing of materials under the field"Application for Exemption Order in", those jurisdictions in which theapplication is being made. The filer should also indicate in a coverletter accompanying the application that there is a related filing ofmaterials that has either been filed or will be filed.

PART 9 PRE-FILINGS AND WAIVER APPLICATIONS

9.1 General

(1) The principles of mutual reliance are available to govern the reviewof pre-filings and waiver applications that are made in more than onejurisdiction. There may be pre-filings and waiver applications wherea formal order is required in some jurisdictions while the issuance ofa receipt will evidence the required relief in other jurisdictions. Thisdifference among the jurisdictions may create ambiguity aboutwhether a particular pre-filing or waiver application should be madeunder this policy or the applications policy. In order to free theprocess of ambiguity, those applications which should be madeunder this Policy are specified in Appendix B.

(2) If the filer does not require exemptive relief in the jurisdiction of itsprincipal regulator, the filer should select the participating principalregulator in the jurisdiction with which the filer has the next mostsignificant connection to act as the principal regulator for thepurposes of the pre-filing or waiver application.

(3) In a letter accompanying materials filed, the filer should describe thesubject matter of any pre-filings or waiver applications made to thenon-principal regulators and the disposition thereof by the non-principal regulators.

(4) If the resolution of a pre-filing or waiver application is a conditionprecedent to the issuance of either a preliminary or final MRRSdecision document, filers are reminded to file the pre-filing or waiverapplication sufficiently in advance of the filing of the related materialsto avoid any delay in the issuance of the MRRS decision document.

(5) Different review procedures apply to those pre-filings and waiverapplications filed under the MRRS that are routine and those thatraise novel and substantive issues.

(6) If a pre-filing or waiver application has been filed, the filer shouldindicate in the SEDAR cover page information for the related filing ofmaterials under the field "Prefiling or Waiver Application", thosejurisdictions in which the pre-filing or waiver application has beenmade. The filer should also indicate in a cover letter accompanyingthe pre-filing or waiver application that there is a related filing ofmaterials that has either been filed or will be filed.

9.2 Procedure for Routine Pre-Filings and Waiver Applications - Except asprovided in section 9.3, a pre-filing or waiver application made under theMRRS should be submitted to the principal regulator in the form required bythe principal regulator, and the filer will deal directly with the principalregulator to resolve the pre-filing or waiver application.

9.3 Procedure for Novel and Substantive Pre-Filings and WaiverApplications

(1) If the principal regulator determines that a pre-filing or waiverapplication filed, or to be filed, under the MRRS involves a novel andsubstantive issue or raises a novel public policy concern

(a) the principal regulator shall direct the filer to submit the pre-filing or waiver application in written form to the principalregulator and the non-principal regulators;

(b) each non-principal regulator shall be given five working daysfrom the date of their receipt of the pre-filing or waiverapplication to forward to the principal regulator and the othernon-principal regulators substantive issues that may, if leftunresolved, cause the non-principal regulator to opt out of thedisposition of the pre-filing or waiver application; and

(c) the principal regulator will notify all non-principal regulators ofits proposed disposition of the pre-filing or waiver applicationand will give each non-principal regulator a reasonable periodof time to advise the principal regulator of its disagreementwith the proposed disposition of the pre-filing or waiverapplication before notifying the filer of the disposition. Theprincipal regulator will advise the filer that the disposition ofthe pre-filing or waiver application represents the dispositionby all non-principal regulators other than those that advisedthe principal regulator of their disagreement with thedisposition within the specified period of time. If a non-principal regulator disagrees with the disposition, the filershould deal directly with that non-principal regulator to resolvethe pre-filing or waiver application.

(2) In circumstances where it is apparent to the filer that a proposed pre-filing or waiver application contains a novel public policy issue, thefiler is encouraged, for the purpose of accelerating the resolution ofthe pre-filing or waiver application, to send the pre-filing or waiverapplication in written form to the non-principal regulatorscontemporaneously with submitting it to the principal regulator.

9.4 Filing of Related Materials - For any materials filed under the MRRS towhich a pre-filing or waiver application relates, the filer should include in thecover letter accompanying the materials a description of the subject matterof the pre-filing or waiver application, including the relevant provisions of thesecurities legislation and securities directions of the principal regulator andeach non-principal regulator and the proposed disposition of the pre-filingor waiver application by the principal regulator and, if applicable, any non-principal regulator that disagreed with the disposition by the principalregulator and had an alternative disposition of the pre-filing or waiverapplication. In the case of a waiver application, the filer should identify theother non-principal regulators from which the requested relief is alsoneeded.

9.5 Effect of Related MRRS Decision Document - In the case of a waiverapplication, the filer should include in the cover letter referred to in section9.4 a request that the non-principal regulators grant the discretionary reliefrequested from the principal regulator. The final MRRS decision documentwill evidence that the principal regulator and the non-principal regulatorsthat have not opted out have granted the discretionary relief requested inthe waiver application. The securities regulatory authorities of certainjurisdictions will also issue their own local decision documents.

PART 10 AMENDMENTS

10.1 Filing of Amendments

(1) Amendment materials should be filed with the principal regulator andthe non-principal regulators in accordance with Part 4 of this Policy.

(2) The Securities Act (Québec) provides that the Commission desvaleurs mobilières du Québec must issue a receipt for a prospectusamendment, other than a prospectus relating to a continuousdistribution, within two working days of receipt of the prospectusamendment. If a filer wishes to apply the MRRS to a prospectusamendment, other than a prospectus amendment relating to acontinuous distribution that is also filed in the province of Québec, itshould include in the cover letter accompanying the prospectusamendment materials statements that

(a) it acknowledges that the Commission des valeurs mobilièresdu Québec may be unable to issue a receipt within twoworking days of the date of receipt of the prospectusamendment and specifically waives any rights it may have tohave a receipt issued by the Commission des valeursmobilières du Québec within that time frame; and

(b) it undertakes to the Commission des valeurs mobilières duQuébec that it will cease the distribution of its securities inQuebec until the prospectus amendment MRRS decisiondocument is issued.

(3) If the filer does not include the statements referred to in subsection(2) in the cover letter accompanying the prospectus amendmentmaterials, the MRRS will not apply to that filing.

(4) Filers are reminded that local securities legislation in otherjurisdictions contain restrictions on distributing securities until theprospectus amendment MRRS decision document is issued, asdiscussed in section 10.9.

10.2 Conditions to Issuance of MRRS Decision Document for PreliminaryProspectus Amendments - The principal regulator will issue a preliminaryprospectus amendment MRRS decision document if

1. the principal regulator has determined that acceptable materials havebeen filed;

2. the filer has confirmed to the principal regulator in a letteraccompanying the materials that:

(a) materials, including all required translations, have been filedwith all relevant non-principal regulators that have not optedout of the MRRS for the materials;

(b) in respect of each jurisdiction in which the materials are filed,the filer has filed or delivered all documents required to befiled or delivered under the local securities legislation and isnot subject to a cease trade order issued by a local securitiesregulatory authority; and

(c) if the amendment reflects the removal of an underwriter, thefiler has confirmed to the principal regulator that in eachjurisdiction in which the securities will be offered topurchasers, at least one underwriter that has signed thecertificate is registered, or has filed an application forregistration or an application for exemptive relief from therequirement to be registered. If none of the underwriters thathas signed the certificate are registered in a jurisdiction inwhich the distribution is being made but one of theunderwriters has filed an application for registration or anapplication for exemptive relief from the requirement to beregistered, that underwriter will file an undertaking with theprincipal regulator not to solicit in that jurisdiction until theregistration or exemption has been obtained.

10.3 Form of MRRS Decision Document for Preliminary ProspectusAmendments

(1) The securities legislation and securities directions in force in certainjurisdictions require that a receipt be issued for a preliminaryprospectus amendment. The securities legislation and securitiesdirections in force in other jurisdictions do not require that a receiptbe issued, and it has been the administrative practice to issue anotice of acceptance of filing for the preliminary prospectusamendment. For the purposes of this Policy, a preliminaryprospectus amendment MRRS decision document shall evidencethat, if applicable, the required receipts or notices of acceptance offiling have been issued by the principal regulator and the non-principal regulators.

(2) The preliminary prospectus amendment MRRS decision documentwill contain the following legend:

This mutual reliance review system decision document evidencesthat receipts or notices of acceptance of filing of the regulators ineach of (name of each jurisdiction in which materials have been filedand where the regulator has not opted out of the MRRS for thematerials) have been issued.

10.4 Review Period for Preliminary Prospectus Amendments

(1) If a preliminary prospectus amendment is filed before the principalregulator issues its comment letter relating to the preliminaryprospectus materials, the principal regulator may be unable tocomplete its review of the preliminary materials and issue itscomment letter within the time periods indicated in sections 5.2 and5.3, as applicable. In this case, the principal regulator will use itsbest efforts to issue its comment letter on the later of the date that isfive working days after the filing of the amendment and the originaldue date for the comment letter.

(2) If a preliminary prospectus amendment for a preliminary long formprospectus is filed after the principal regulator has issued itscomment letter

(a) the principal regulator will use its best efforts to review thematerials and issue a comment letter within five working daysof the date of the preliminary prospectus amendment MRRSdecision document; and

(b) the non-principal regulators will use their best efforts to advisethe principal regulator of any material concerns with thematerials that, if left unresolved, would cause the non-principal regulator to opt out of the MRRS within the later of

(i) three working days of the date of the preliminaryprospectus amendment MRRS decision document; and

(ii) the expiry of the time period indicated in section 5.2 forreview by the non-principal regulator of the preliminarymaterials.

(3) If a preliminary prospectus amendment for a preliminary short formprospectus is filed after the principal regulator has issued itscomment letter

(a) the principal regulator will use its best efforts to review thematerials and issue a comment letter within two working daysof the date of the preliminary prospectus amendment MRRSdecision document; and

(b) the non-principal regulators will use their best efforts to advisethe principal regulator of any material concerns with thematerials that, if left unresolved, would cause the non-principal regulator to opt out of the MRRS within the later of

(i) one working day of the date of the preliminaryprospectus amendment MRRS decision document, and

(ii) the expiry of the time period indicated in section 5.3 forreview by the non-principal regulator of the preliminarymaterials.

(4) The time periods in subsections (2) and (3) may not apply in certaincircumstances if it would be more appropriate for the principalregulator and the non-principal regulators to review the amendmentmaterials at a different stage of the review process. For example, theprincipal regulator and the non-principal regulators may wish to deferreview of the amendment materials until after receiving and reviewingthe filer's responses to comments already issued in respect of thepreliminary materials.

10.5 Review Period for Prospectus Amendments

(1) If a prospectus amendment to a long form prospectus, other than aprospectus for a mutual fund, is filed, the principal regulator will useits best efforts to review the materials and to issue a comment letterwithin five working days of the date of the receipt of the prospectusamendment, and the non-principal regulators will use their bestefforts to advise the principal regulator of any material concerns withthe materials that, if left unresolved, would cause the non-principalregulator to opt out of the MRRS within three working days of thedate of the receipt of the prospectus amendment.

(2) If a prospectus amendment to a short form prospectus or to aprospectus for a mutual fund is filed, the principal regulator will useits best efforts to review the materials and to issue a comment letterwithin two working days of the date of the receipt of the prospectusamendment, and the non-principal regulators will use their bestefforts to advise the principal regulator of any material concerns withthe materials that, if left unresolved, would cause the non-principalregulator to opt out of the MRRS within one working day of the dateof the receipt of the prospectus amendment.

10.6 Conditions to Issuance of Prospectus Amendment MRRS DecisionDocument - The principal regulator will issue a prospectus amendmentMRRS decision document if

1. all comments raised have been resolved to the satisfaction of theprincipal regulator and, if applicable, any non-principal regulator thathas not opted out of the MRRS for the materials;

2. the principal regulator has determined that acceptable materials havebeen filed;

3. the filer has confirmed to the principal regulator in a letteraccompanying the materials that:

(a) materials, including all required translations, have been filedwith all non-principal regulators that have not opted out of theMRRS for the materials;

(b) in respect of each jurisdiction in which the materials are filed,the filer has filed or delivered all documents required to befiled or delivered under the local securities legislation and isnot subject to a cease trade order issued by a local securitiesregulatory authority;

(c) if the amendment reflects the removal of an underwriter, thefiler has confirmed to the principal regulator that in eachjurisdiction in which the securities will be offered topurchasers, at least one underwriter that has signed thecertificate is registered; and

(d) all necessary relief from applicable securities legislation orsecurities directions has been applied for and granted by theprincipal regulator and non-principal regulators.

 

10.7 Form of Prospectus Amendment MRRS Decision Document

(1) The securities legislation and securities directions in force in differentjurisdictions impose different requirements on receipting or acceptingamendments. The securities legislation and securities directions inforce in certain jurisdictions require that a receipt be issued for anyprospectus amendment, whereas the securities legislation andsecurities directions in force in other jurisdictions do not require thata receipt be issued, and it has been the administrative practice toissue a notice of acceptance of filing for the prospectus amendment.The securities legislation and securities directions in otherjurisdictions require that a receipt be issued for a prospectusamendment only where the prospectus amendment is filed for thepurpose of distributing securities in addition to the securitiespreviously disclosed in the related prospectus. For the purposes ofthis Policy, a prospectus amendment MRRS decision document willconstitute confirmation that, if applicable, the required receipts ornotices of acceptance of filing have been issued by the principalregulator and the non-principal regulators.

 

(2) The prospectus amendment MRRS decision document will containthe following legend:

This mutual reliance review system decision document evidencesthat receipts or notices of acceptance of filing of the regulators ineach of (name of each jurisdiction in which materials have been filedand where the regulator has not opted out of the MRRS for thematerials) have been issued.

10.8 Local Decision Document - Despite the issuance of the MRRS decisiondocument, certain non-principal regulators will issue concurrently their owndecision documents for amendments. In the case of prospectusamendments, it is not necessary for a filer to obtain a copy of the localdecision document before recommencing the distribution of its securities.

10.9 Other Requirements

(1) Filers are reminded that the securities legislation and securitiesdirections in force in certain jurisdictions require that where anamendment has been filed for the purposes of distributing securitiesin addition to the securities previously disclosed in the prospectus,the additional distribution shall not be proceeded with for a specifiedperiod of time.

(2) Filers are also reminded that the securities legislation and securitiesdirections of certain jurisdictions provide that, except in certaincircumstances with the written permission of a designated person, adistribution or additional distribution must not proceed until a receiptfor a prospectus amendment is issued.

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Dated January 1, 2000⁽¹⁾

APPENDIX A
MATERIALS REQUIRED TO BE FILED

The attached lists of documents, as varied in accordance with the following guidance, arethose required to be filed or delivered under each category of filing to which the Policyapplies. Filers should refer to the provisions of the applicable local jurisdictions todetermine whether materials should be filed or delivered.

The following guidance applies to all filings of materials under the MRRS.

1. Where a filing is to be made in the provinces of Quebec or New Brunswick, aFrench language version of the following documents must also be filed:

(a) the preliminary prospectus and the prospectus; and

(b) any amendment to a preliminary prospectus and any amendment to aprospectus.

French language translation of Annual Information Forms is not required at the timeof filing, except that French language versions of all of the documents incorporatedby reference, including the Annual Information Form, and not previously filed withthe relevant securities regulatory authorities must also be filed at the time of filingof the preliminary short form prospectus.

2. The attached lists do not refer to the applicable filing and distribution fees requiredby the securities regulatory authorities. The filer should consult the fee schedulesof the relevant securities legislation for the applicable fees.

For filers that are permitted to file materials in paper form under NationalInstrument 13-101 System for Electronic Document Analysis and Retrieval(SEDAR), the payment of fees should be made by cheque payable as follows:

British Columbia - British Columbia Securities Commission
Alberta - Alberta Securities Commission
Saskatchewan - Minister of Finance
Manitoba - Minister of Finance
Ontario - Ontario Securities Commission
Quebec - Commission des valeurs mobilieres du Quebec
New Brunswick - Minister of Finance
Nova Scotia - Minister of Finance
Prince Edward Island - Provincial Secretary
Newfoundland - Newfoundland Exchequer Account
Northwest Territories - Government of the Northwest Territories
Yukon Territory - Government of Yukon
Nunavut - Nunavut Securities Registry

In all other cases, payment of filing fees should be transmitted electronicallythrough SEDAR.

3. Additional filing requirements apply to certain types of offerings such as offeringsusing the shelf offering procedures, the post receipt pricing procedures or themulti-jurisdictional disclosure system. Reference should be made to the applicableprovisions of national or local rules or policies for any additional filing requirementsor procedures.

4. Further filing requirements for Alberta are contained in ASC Local Policy 4-7.

5. Further filing requirements for Ontario are contained in Ontario SecuritiesCommission Policies No. 5.1, 5.2 and 5.7.

6. Further filing requirements for British Columbia are contained in Local PolicyStatement 41-601.

7. Further filing requirements for Québec are contained in local securities legislationand local securities directions.

8. Where the attached lists refer to "personal information regarding directors, seniorofficers and promoters" the filer should provide, for each director and senior officerof the filer and for each promoter of the filer (or in the case where the promoter isnot an individual, for each director and senior officer of the promoter) the followinginformation for security check purposes:

(i) full name;

(ii) place and date of birth;

(iii) full residential address;

(iv) employer's name and address.

Additionally, where the offering is to made in Ontario, the filer must fileNotice/Consent Forms under the Freedom of Information and Protection of PrivacyAct, 1987 (Ontario). Where Saskatchewan, Manitoba or Nova Scotia is principalregulator, a RCMP GRC Securities Fraud Information Centre Request Form #2674(89-07) must be filed. In connection with the filing of an initial public offeringprospectus: (i) where Quebec is principal regulator, a Form 4 under the Regulationconcerning securities made under the Securities Act (Quebec) must be filed; and(ii) where British Columbia is principal regulator, the filer must file a Form 4B orstatutory declaration if required by Local Policy Statement 41-601.

9. The following lists make reference to certain documents which are required to befiled only in certain jurisdictions. Where this is the case, the jurisdiction(s) in whichthe filing requirements exist are indicated in parentheses next to the document.

PRELIMINARY OR PRO FORMA LONG FORM PROSPECTUS

1. Preliminary or pro forma long form prospectus

2. A blackline, if the issuer wishes its prospectus to be treated as a seasonedprospectus

3. Technical reports and certificates relating to natural resource properties

4. Letter from the auditor prepared in the form suggested by the CICA Handbook ifa financial statement included in the preliminary or pro forma prospectus isaccompanied by an unsigned auditor's report

5. Personal information regarding directors, senior officers and promoters for the filer

6. Earnings coverage calculations, if applicable

7. Copies of all material contracts to which the filer is a party that have not previouslybeen filed. In Ontario, filers need only file copies of material contracts that createor materially affect the rights or obligations of the holders of the securities beingdistributed and that have not previously been filed

8. Draft escrow agreement, if applicable

9. Filing fees

10. A letter to the principal regulator prepared in accordance with section 7.2 of thePolicy

FINAL LONG FORM PROSPECTUS

1. Final long form prospectus

2. Final long form prospectus - black-lined to show changes from the preliminary longform prospectus

3. Technical reports and certificates relating to natural resource properties, if revisedsince the filing of the preliminary prospectus and not filed prior to the filing of thefinal prospectus

4. Auditors' comfort letter regarding any unaudited financial statements contained inthe final long form prospectus

5. Consents of auditors, legal counsel and other experts, if any

6. Copy of the underwriting or agency agreement

7. Copies of all other material contracts not previously filed. In Ontario, filers needonly file copies of material contracts not previously filed that create or materiallyaffect the rights or obligations of the holders of the securities being distributed

8. Submission to jurisdiction and appointment of agent, if applicable

9. Filing fees

10. A letter to the principal regulator prepared in accordance with section 7.4 of thePolicy

PRELIMINARY SHORT FORM

1. Preliminary short form prospectus

2. Technical reports and certificates relating to natural resource properties ⁽²⁾

3. Earnings coverage calculations, if applicable

4. Copies of all material incorporated by reference and not previously filed

5. Personal information regarding directors, officers and promoters if not previouslyfiled

6. Filing fees

7. A letter to the principal regulator prepared in accordance with section 7.2 of thePolicy

FINAL SHORT FORM PROSPECTUS

1. Final short form prospectus

2. Final short form prospectus - black-lined to show changes from the preliminaryshort form prospectus

3. Auditors' comfort letter regarding any unaudited financial statements contained inor incorporated by reference into the final short form prospectus

4. Consents of auditors, legal counsel and other experts, if any

5. Copy of the underwriting agreement

6. Any material contract requested by staff

7. Copies of all material incorporated by reference and not previously filed

8. Filing fees

9. A letter to the principal regulator prepared in accordance with section 7.4 of thePolicy

AMENDMENTS TO PRELIMINARY PROSPECTUS AND PROSPECTUS(SHORT FORM AND LONG FORM)

1. Amendment

2. Auditors' comfort letters, if applicable

3. Consents of auditors, legal counsel and other experts, if applicable

4. Filing fees

5. A letter prepared in accordance with section 10.1(2) of the Policy, if applicable

6. A letter to the principal regulator that:

(a) for Preliminary Prospectus Amendments, is prepared in accordance withsection 10.2 of the Policy; or

(b) for Prospectus Amendments, is prepared in accordance with section 10.6of the Policy

INITIAL ANNUAL INFORMATION FORM

1. Initial annual information form

2. Eligibility certificate of filer

3. Material incorporated by reference

4. For filers whose initial AIF is in the form of an annual report on Form 10-K or Form20-F, an undertaking to provide certain disclosure documents to any person orcompany upon request

5. Notice of intention to file preliminary prospectus (for first time use of the Short FormProspectus system in Quebec only)

6. Filing fees, if applicable

7. A letter to the principal regulator prepared in accordance with section 7.4 of thePolicy

RENEWAL ANNUAL INFORMATION FORM

1. Renewal annual information form

2. Eligibility certificate of filer

3. Materials incorporated by reference

4. Filing fees, if applicable

5. For filers whose renewal AIF is in the form of an annual report on Form 10-K orForm 20-F, an undertaking to provide certain disclosure documents to any personupon request

6. Notice of intention to file preliminary prospectus (for first time use of the Short FormProspectus system in Quebec only)

PRELIMINARY SIMPLIFIED PROSPECTUS AND ANNUAL INFORMATION FORM FILED UNDER NPS 36

1. Preliminary simplified prospectus

2. Preliminary simplified prospectus - blacklined

(where new fund is being qualified by a separate prospectus but is to be part of anexisting group of funds sold by prospectus, a blacklined version of the simplifiedprospectus should indicate any changes from the existing simplified prospectus forthe group of funds)

3. Preliminary annual information form

4. Preliminary annual information form - blacklined

(where new fund is being qualified by a separate prospectus but is to be part of anexisting group of funds sold by prospectus, a blacklined version of the annualinformation form should indicate any changes from the existing annual informationform for the group of funds)

5. Copy or draft of all material contracts for the new mutual funds

6. For a new mutual fund in a new mutual fund group, personal information regardingindividuals acting as trustees and promoters, and directors and senior officers ofthe fund, trustee, manager and promoter. If the mutual fund is a member of amutual fund family for which this type of information was previously provided, theinformation would be required only for those persons for whom the information wasnot previously provided by other members of the mutual fund family

7. Financial statements, if applicable

8. Filing fees

9. A letter to the principal regulator prepared in accordance with section 7.2 of thePolicy

PRO FORMA SIMPLIFIED PROSPECTUS AND ANNUAL INFORMATION FORM FILED UNDER NPS 36

1. Pro forma simplified prospectus

2. Pro forma simplified prospectus - blacklined to indicate all changes fromprevious version

3. Pro forma annual information form

4. Pro forma annual information form - blacklined to indicate all changes fromprevious version

5. Copy or draft of all material contracts not previously filed

6. Personal information regarding individuals acting as trustees and promoters,and directors and senior officers of the fund, trustee, manager and promoterwhere this information has not previously been provided for these persons inconnection with a previous filing of the mutual fund family

7. Compliance report required under section 7.01(4) of NPS 39

8. Filing fees

FINAL SIMPLIFIED PROSPECTUS AND ANNUAL INFORMATION FORM FILED UNDER NPS 36

1. Final simplified prospectus

2. Final simplified prospectus - blacklined to show changes from preliminary or proforma simplified prospectus, as the case may be

3. Final annual information form

4. Final annual information form - blacklined to show changes from preliminary orpro forma annual information form, as the case may be

5. Copy of all material contracts not previously filed

6. For new funds, audited financial statements if not previously filed

7. Auditors' consent letter re audited financial statements

8. Auditors' comfort letter re unaudited financial statements, if applicable

9. Consent of legal counsel or other experts

10. Certificate re proceeds of distribution in the jurisdiction (B.C., Alberta, Ontario,Quebec)

11. Filing fees

12. A letter to the principal regulator prepared in accordance with section 7.4 of thePolicy

AMENDMENT TO A SIMPLIFIED PROSPECTUS AND ANNUAL INFORMATION FORM FILED UNDER NPS 36

1. Amendment to simplified prospectus

2. Amendment to simplified prospectus - blacklined (where amendment is anamended and restated simplified prospectus)

3. Amendment to annual information form

4. Amendment to annual information form - blacklined (where amendment is anamended and restated annual information form)

5. Copy of all material contracts not previously filed

6. Auditors' consent letter, if applicable

7. Auditors' comfort letter, if applicable

8. Consent of legal counsel and other experts, if applicable

9. Filing fees

10. A letter to the principal regulator prepared in accordance with section 10.6 ofthe Policy

APPENDIX B

1. relief from financial statement requirements

2. relief from escrow requirements

3. applications relating to pro forma statement requirements

4. applications relating to representations as to listing

¹ This appendix will be amended from time to time to conform to changes resulting from thereformulation of related instruments.

²Unless a technical report is specifically referred to in a short form prospectus or the applicable Canadiansecurities regulatory authority believes that unusual circumstances warrant the exercise of discretion to require thefiling of a technical report, technical reports and certificates of qualification are not required to be filed in anyjurisdiction (except in Quebec, where technical reports and certificates of qualification are required to be filedwhen a significant portion of the proceeds is to be expended on a particular property). Although the prospectusincorporates by reference the filer's AIF, a reference to the name of the independent engineer or other qualifiedperson in the AIF does not constitute a reference to a report prepared by that person in the short form prospectus.Therefore, the issuer is not required to file the report, but must file, with the final short form prospectus, theconsent of the person who prepared it.