European Bank for Reconstruction and Development

Headnote

Multilateral development bank granted exemption from registration and prospectus requirements in Ontario, subject to conditions - Relief similar to exemption for "permitted supranational agency" in section 2.34 of National Instrument 45-106 - Prospectus and Registration Exemptions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25, 53, 74.

Rules Cited

National Instrument 45-106 - Prospectus and Registration Exemptions, s. 2.34.

IN THE MATTER OF

THE SECURITIES ACT

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

THE EUROPEAN BANK FOR RECONSTRUCTION

AND DEVELOPMENT

(the Applicant)

ORDER

Background

The Ontario Securities Commission (the Commission) has received an application from the Applicant for an order pursuant to subsection 74(1) of the Securities Act (Ontario) (the Act) that the requirement in section 25 of the Act to be registered to trade in a security and the requirement in section 53 of the Act to file and obtain a receipt for a preliminary prospectus and a final prospectus in respect of a trade in a security shall not apply in respect of a trade in a debt security (as defined in National Instrument 45-106 Prospectus and Registration Requirements (NI 45-106) of, or guaranteed by, the Applicant (the Requested Relief).

Interpretation

Defined terms contained in NI 45-106 and NI 14-101 have the same meaning in this order unless they are defined in this order.

Representations

The order is based on the following facts represented by the Applicant:

1. The Applicant is a multilateral development bank whose shareholders include 61 countries and two intergovernmental institutions (being the European Community and the European Investment Bank).

2. The Applicant was established in 1991 pursuant to the Agreement Establishing the European Bank for Reconstruction and Development (the Agreement), which was signed in Paris, France on May 29, 1990, with the Agreement entering into force on March 28, 1991. Canada is a founding member of the Applicant.

3. Pursuant to the Privileges and Immunities of the European Bank for Reconstruction and Development Order, SOR/93-612, the Bank shall have in Canada the privileges and immunities set out in Chapter VIII of the Agreement.

4. The Applicant's purpose is to foster the transition towards open market-oriented economies and to promote private and entrepreneurial initiatives in its "countries of operations" which are committed to applying the principles of multiparty democracy, pluralism and market economics. The Applicant's countries of operations are located in central and eastern Europe and in the territory of the former U.S.S.R. and, since 2005, include Mongolia. In order to carry out that mandate, the Applicant:

(a) provides financing for banks, industries and businesses pertaining to new ventures as well as investing in existing companies;

(b) promotes the establishment, improvement and expansion of productive, competitive and private sector activity, in particular with respect to small and medium-sized enterprises;

(c) works with publicly owned companies to facilitate the transition to privatization;

(d) helps to restructure state-owned firms and improve municipal services;

(e) promotes policies that will bolster the business environment, as well as democratic principles;

(f) mobilizes domestic and foreign capital;

(g) provides technical assistance to businesses relating to the preparation, financing and implementation of relevant projects;

(h) stimulates and encourages the development of capital markets; and

(i) promotes environmentally sound and sustainable development.

5. Based on the Applicant's Financial Report for the 2006 financial year, as at December 31, 2006, the Applicant had total assets of €30,691,000,000, total liabilities of €18,519,000,000, total equity of €12,172,000,000 and callable capital of €15,000,000,000.

6. The Applicant has been assigned the following issuer ratings for its long-term debt by the following rating agencies:

Standard & Poors: AAA (since 1991)

Moody's Investors Services: Aaa (since 1992)

Fitch Ratings: AAA (since 2002).

7. The Applicant does not have any offices in Canada.

8. Pursuant to regulatory orders issued by the securities regulator or securities regulatory authority in each of British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (the Jurisdictions) it has been ordered that the dealer registration requirement and the prospectus requirement in each of the Jurisdictions shall not apply in respect of a trade in a debt security of or guaranteed by the Applicant.

Order

The Commission is satisfied that it would not be prejudicial to the public interest to grant the Requested Relief.

The ruling of the Commission pursuant to subsection 74(1) of the Act is that the Requested Relief is granted, provided that the debt securities are payable in the currency of Canada or the United States of America.

DATED on October 12th, 2007

"Harold P. Hands"

"Suresh Thakrar"