Economical Insurance Company and Teig Investment Partnership - s. 147

Headnote

Exemption for pooled funds from the requirement to file with the Commission interim financial statements under section 77(2) of the Act and comparative financial statements under section 78(1) of the Act, subject to conditions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5 as am., ss. 74(1).

Regulations Cited

Regulation made under the Securities Act, R.R.O. Reg. 1015, as am.

Rules Cited

National Instrument 13-101 -- System for Electronic Document Analysis and Retrieval (SEDAR), s.2.1(1)1.

May 3, 2005

IN THE MATTER OF

THE SECURITIES ACT (ONTARIO), R.S.O. 1990,

CHAPTER S.5 AS AMENDED (THE "ACT")

AND

IN THE MATTER OF

ECONOMICAL MUTUAL INSURANCE COMPANY

AND

TEIG INVESTMENT PARTNERSHIP

ORDER

(Subsection 147 of the Act)

UPON the application (the "Application") of Economical Insurance Company ("Economical") and TEIG Investment Partnership (the "Partnership") to the Ontario Securities Commission (the "Commission") for an order pursuant to subsection 147 of the Act exempting the Partnership from filing with the Commission the interim and comparative financial statements prescribed by sections 77(2) and 78(1), respectively, of the Act;

AND UPON considering the Application and the recommendation of staff of the Commission;

AND UPON the Partnership having represented to the Commission that:

1. The Partnership was created on October 1, 2004 among Economical and its wholly-owned subsidiaries, being Federation Insurance Company of Canada, The Missisquoi Insurance Company, the Waterloo Insurance Company and Perth Insurance Company (collectively, the "Subsidiaries").

2. The sole purpose of the Partnership was to create a fund to pool the investment portfolio held by Economical and its Subsidiaries (collectively, the "Partners") through capital contributions made to the Partnership and to utilize those capital contributions to invest in securities and other financial instruments.

3. None of Economical or its Subsidiaries are reporting issuers under the Act.

4. The Partnership is a fund created under the laws of the Province of Ontario.

5. The Partnership fits within the definition of "mutual fund in Ontario" in section 1(1) of the Act and is therefore required to file interim and comparative annual financial statements with the Commission under subsections 77(2) and 78(1) of the Act (collectively, the Financial Statements).

6. While the Partnership is structured as a mutual fund, it is not a public mutual fund. The Partnership is not a reporting issuer and is not sold to the general public.

7. Economical manages the Partnership, and the securities of the Partnership are or will be distributed in Canada to the Partners without a prospectus pursuant to exemptions from the prospectus requirements of applicable securities legislation.

8. There are not now, nor will there be, any unitholders in the Partnership other than Economical and its Subsidiaries.

9. Partners of the Partnership receive annual and semi-annual financial statements. The Partnership's annual financial statements are audited by Ernst & Young LLP or such other firm whose partners are members in good standing of the Canadian Institute of Chartered Accountants and which is appointed from time to time as auditor of the Partnership in accordance with its constating documents.

10. Section 2.1(1)1 of National Instrument 13-101 -- System for Electronic Document Analysis and Retrieval (SEDAR) requires that every issuer required to file a document under securities legislation make its filing through SEDAR. The financial statements filed with the Commission thus become publicly available.

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;

IT IS ORDERED by the Commission pursuant to subsection 147 of the Act that the Partnership be exempted from the requirements in sections 77(2) and 78(1) of the Act to file the Financial Statements with the Commission provided:

(a) The Partnership will prepare and deliver to the Partners of the Partnership the Financial Statements, in the form and for the periods required under the Act and the Regulation, as if the Financial Statements are required to be filed with the Commission;

(b) The Partnership will retain the Financial Statements indefinitely;

(c) The Partnership will provide the Financial Statements to the Commission or any member, employee or agent of the Commission immediately upon request of the Commission or any member, employee or agent of the Commission;

(d) Partners of the Partnership will be notified that the Partnership are exempted from the requirements in sections 77(2) and 78(1) of the Act to file the Financial Statements with the Commission;

(e) In all other aspects, the Partnership will comply with the requirements in Ontario securities law for financial statements; and

(f) This decision, as it relates to the Commission, will terminate after the coming into force of any legislation or rule of the Commission dealing with the matters regulated by sections 77(2) and 78(1) of the Act.