iA Global Asset Management Inc. and Industrial Alliance, Investment Management Inc.

Headnote

Under paragraph 4.1(1)(b) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, a registered firm must not permit an individual to act as a dealing, advising or associate advising representative of the registered firm if the individual is registered as a dealing, advising or associate advising representative of another firm registered in any jurisdiction of Canada. The dually registered representatives will have sufficient time to adequately serve both firms. Conflicts of interest are unlikely to arise because clients of the Filers and the products offered by the Filers differ considerably. Both firms have policies and procedures in place to address potential conflicts of interest and the dually registered representatives are aware of those policies and procedures. The relief is conditional on the Filers only providing services to institutional permitted clients. The firms are exempted from the prohibition.

Applicable Legislative Provisions

Multilateral Instrument 11-102 Passport System, s. 4.7.

National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 4.1 and 15.1.

Derivatives Act (Quebec) and Derivatives Regulation (Quebec), respectively under section 86 and 11.1.

[COURTESY TRANSLATION]

October 7, 2022

IN THE MATTER OF THE SECURITIES LEGISLATION OF QUÉBEC AND ONTARIO (the Jurisdictions) AND IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS AND IN THE MATTER OF IA GLOBAL ASSET MANAGEMENT INC.(iAGAM) AND INDUSTRIAL ALLIANCE, INVESTMENT MANAGEMENT INC. (iAIM and, together with iAGAM, the Filers)

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application from the Filers for a decision under the securities legislation of the Jurisdictions (the Legislation) for relief from the restriction contained in paragraph 4.1(1)(b) of Regulation 31-103 respecting Registration Requirements, Exemptions and Ongoing Registrant Obligations (Regulation 31-103), pursuant to section 15.1 of Regulation 31-103, to permit the Representatives (as defined below) to be registered as an advising representative or associate advising representative, as the case may be, of each of iAIM and iAGAM (the Exemption Sought).

The principal regulator has also received an application from the Filers for a decision under the derivatives legislation of Québec for relief from the prohibition in paragraph 4.1(1)(b) of Regulation 31-103 as applicable by section 11.1 of the Derivatives Regulation (Québec), CQLR, c. I-14.01, r. 1, pursuant to section 86 of the Derivatives Act (Québec), CQLR, c. I-14.01, to permit the Representatives (as defined below) to be registered as a derivatives advising representative or derivatives associate advising representative, as the case may be, of each of iAIM and iAGAM (the Exemption Sought for Derivatives).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) the Autorité des marchés financiers is the principal regulator of the Filers for this application;

(b) the Filers have provided notice that subsection 4.7(1) of Regulation 11-102 respecting Passport System (chapter V-1.1, r. 1) (Regulation 11-102) is intended to be relied upon in Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia and Saskatchewan;

(c) the decision regarding the Exemption Sought is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario; and

(d) the decision regarding the Exemption Sought for Derivatives is the decision of the principal regulator.

Interpretation

Terms defined in Regulation 11-102 and Regulation 14-101 respecting Definitions (chapter V-1.1, r. 3) have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filers:

1. iAIM is a corporation incorporated under the laws of Canada with its head office located in Québec City, Québec. iAIM is a wholly owned subsidiary of Industrial Alliance Insurance and Financial Services Inc. (iAIFS), a life and health insurance corporation and financial services provider, which is itself a wholly owned subsidiary of iA Financial Corporation Inc. (iA Financial Corporation), a holding company which controls a large network of subsidiaries inside and outside of Canada operating in the business of individual insurance, individual wealth management, group insurance and group savings and retirement businesses, among others.

2. iAIM is registered as a portfolio manager in the provinces of Québec, Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia, Ontario and Saskatchewan, as an investment fund manager and derivatives portfolio manager in Québec, and as a commodity trading counsel and a commodity trading manager in Ontario.

3. iAGAM is a corporation incorporated under the laws of Canada with its head office located in Québec City, Québec. iAGAM is a wholly-owned subsidiary of iAIM, and therefore an indirect wholly-owned subsidiary of iAIFS and an indirect wholly-owned subsidiary of iA Financial Corporation.

4. iAGAM is registered as a portfolio manager in the provinces of Québec, Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia, Ontario and Saskatchewan, as an investment fund manager and derivatives portfolio manager in Québec, and as a commodity trading counsel and a commodity trading manager in Ontario.

5. The principal regulator of both Filers is the AMF.

6. The Filers are affiliates as they are both subsidiaries of iAIFS, a wholly owned subsidiary of iA Financial Corporation.

7. The Filers' offices are located at the same address and they share the same back-office functions; however, the Filers have their own respective office space.

8. Both of the Filers also share common officers and directors and have the same Chief Compliance Officer (CCO) and Ultimate Designated Person (UDP).

9. The Filers are not in default of any requirements of securities legislation, commodity futures legislation or derivatives legislation in any of the jurisdictions of Canada.

10. iAIM offers managed accounts exclusively to sophisticated institutional investors, including pension funds, insurance and financial services companies, trusts, charitable organizations and corporations. All of iAIM's clients are "permitted clients", as defined in Regulation 31-103, and none of them are individuals. iAIM's non-individual "permitted clients" include segregated funds and pooled funds, as well as the iA Clarington Investments Inc. mutual funds, for which iAIM acts as portfolio manager.

11. A significant portion of iAIM's clients are its affiliated entities. The current affiliates for which iAIM provides portfolio management services include iAIFS (a life and health insurance corporation and financial services provider), Industrial Alliance, Auto and Home Insurance Inc. (an insurance company that provides property, casualty, auto and home insurance), Industrial Alliance Pacific General Insurance Corporation (an insurance company that provides creditor insurance, extended warranties and replacement insurance), Investia Financial Services Inc. (a mutual fund brokerage company), iA Clarington Investments Inc. (a mutual fund manufacturer), Industrial Alliance Trust Inc. (a trust and deposit taking company that provides selected complementary trust services for iA Financial Corporation subsidiaries), SAL Marketing Inc. (a company that is engaged in the marketing and distribution of automotive related warranty products, and that also sells vehicle service contracts in certain provinces), PPI Management Inc. (an insurance brokerage agency), Michel Rhéaume et associés ltée (an insurance brokerage agency), Lubrico Warranty Inc. (an automotive warranty provider), National Warranties MRWV Limited (an automotive warranty provider), and Prysm General Insurance Inc. (a property insurance, fire insurance, liability insurance, automobile insurance and legal insurance and assistance company).

12. When distinguished by "asset types", clients can either be labelled "general funds" (i.e. monies belonging to an entity or monies of related insurance companies that are invested to satisfy their liabilities under insurance contracts), "segregated funds", "mutual funds" or "pooled funds".

13. When distinguished by "status", clients can either be labelled "iA financial institutions", "iA non-financial institutions" or "external clients".

14. iAIM's clients are proposed to be generally divided amongst the Filers based on their "status": iA financial institutions will remain clients of iAIM, and both iA non-financial institutions and external clients will become clients of iAGAM, except for National Warranties MRWV Limited, SAL Marketing Inc. and Lubrico Warranty Inc., which are considered iA non-financial institutions but will be serviced by iAIM instead of iAGAM.

15. Under this proposed separation of client bases, the distinction between "asset types" will be as follows: iAIM will retain the "general funds", while iAGAM will service the "segregated funds", "mutual funds" and "pooled funds".

16. The only client which is intended to be a client of both Filers is iAIFS, the direct parent entity of iAIM and indirect parent entity of iAGAM. As an iA financial institution, iAIFS' "general funds" will be managed by iAIM. However, the iA non-financial institutions will include the "segregated funds" of iAIFS. Accordingly, the management of iAIFS' assets will be divided between iAIM for the "general funds" and iAGAM for the "segregated funds".

17. As of this date, each of the individuals listed in Appendix A (collectively, the Existing Representatives) is registered as an advising representative, an associate advising representative, a derivatives advising representative and/or a derivatives associate advising representative of iAIM. In future, iAIM expects to add additional registered individuals (collectively, the Future Representatives) to be so employed by both iAIM and iAGAM. The Existing Representatives and the Future Representatives are collectively referred to as the Representatives.

18. For various business reasons, it was decided to require the business of iAIM to be continued through two subsidiaries: iAIM and iAGAM. Accordingly, it was decided to create and register iAGAM with the same structure, compliance systems, management and registered representatives as iAIM.

19. Together, the Filers will conduct the business currently being conducted by iAIM.

20. iAGAM intends to sponsor the Representatives, which will thereby become "dually" registered Representatives with both iAIM and iAGAM.

21. There are valid business reasons for the Representatives to be registered with both Filers. The Filers seek to ensure that their operational structure will be aligned with their business model while effectively meeting the policy objectives of Regulation 31-103.

22. The Filers intends to extend iAIM's compliance systems to iAGAM and establish a fully harmonized compliance organization that will oversee the operations and activities of both Filers.

23. The beneficial ownership of each of the Filers is identical and all elements of compliance and strategic oversight of the Filers will be harmonized. Accordingly, there will not exist, and there is no reason that there should ever arise, any conflicts of interests as between the Filers or as between the duties of an individual serving as a Representative of one of the Filers and any duties such person may have with the other Filer.

24. In all respects, clients of each of the Filers will be provided with the same resources (including, for example, the benefits of research and technology) and, perhaps more significantly, the same safeguards (including, for example, compliance monitoring and financial depth).

25. All Representatives will have sufficient time to adequately serve both Filers. The CCO and UDP of each Filer will ensure that the Representatives continue to have sufficient time and resources to adequately serve each Filer.

26. The Filers have the same CCO and appropriate compliance and supervisory policies and procedures in place to monitor the conduct of the Representatives, including any material conflicts of interest that may arise as a result of the dual registration of the Representatives.

27. All Representatives will act fairly, honestly and in good faith and in the best interests of the clients of each Filer.

28. The Filers will be able to appropriately deal with any conflict arising out of the dual registration, as the case may be.

29. In light of the sophistication of the Filers' non-individual "permitted clients" base, the Exemption Sought is not reasonably expected to deceive, mislead, or cause confusion to the Filers' existing and prospective non-individual "permitted clients".

30. The business carried on through each Filer will be similar in all material respects and while registered through both firms, the Representatives will be engaging in the same type of activities that the Representatives were carrying on before the creation of iAGAM, and will do so with the same clients that they were working with. Accordingly, the Filers do not expect that the dual registration of these Representatives will create any additional work for them, and are comfortable that the Representatives will continue to have sufficient time to adequately serve both firms.

31. The Filers are each indirect wholly-owned subsidiaries of iA Financial Corporation and accordingly, the dual registration of the Representatives will not give rise to the conflicts of interests present in a similar arrangement involving unrelated, arm's length firms.

32. The Filers each have in place policies and procedures to address conflicts of interests that may arise as a result of the dual registration of Representatives, and believe that they will be able to appropriately deal with these conflicts.

33. The policies and procedures of the Filers include policies and procedures for the following:

a) mitigating or eliminating any client confusion that may result from the dual registration of the Representatives;

b) ensuring that Representatives know which Filer they are acting on behalf of, when interacting with each client or prospective client;

c) ascertaining the responsible Filer in respect of the supervision of each Representative;

d) ascertaining the responsible Filer in respect of any complaints from current or prospective clients;

e) handling and tracking the records for each Filer, including ensuring that the appropriate records are kept for each Filer by the Representatives; and

f) ensuring necessary and timely interaction between the compliance personnel of each Filer to resolve any matters in respect of the dual registration of the Representatives (including having shared supervisors and branch managers, if appropriate).

34. The compliance teams of the Filers are equipped to:

a) manage and address the complexity and size of the Filers;

b) adequately communicate amongst each other, or share compliance staff;

c) access the necessary books and records of each Filer;

d) manage conflicts of interest specific to affiliated registered firms and organizations;

e) mitigate any confusion, or potential confusion, that may arise for Representatives regarding which firms they are servicing and in what capacity;

f) mitigate client confusion stemming from the dual registration of the Representatives within an affiliated organization;

g) supervise a large number of registered individuals across affiliated registrants; and

h) provide adequate compliance for distinct business lines.

35. In the absence of the Exemption Sought, the Filers would be prohibited from permitting Representatives to act as Representatives of their firm while the individuals are Representatives of the other Filer, which will require significant changes to iA Financial Corporation's planned operating structure, even though iAGAM and iAIM are affiliates. Further, iAGAM will be required to hire new Representatives, and the clients of iAIM which will become clients of iAGAM will be required to establish new relationships with these new iAGAM Representatives.

Decision

Each of the Decision Makers in respect of the Exemption Sought is satisfied that the decision meets the test set out in the Legislation. The principal regulator in respect of the Exemption Sought for Derivatives is satisfied that the decision meets the test set out in the derivatives legislation of Québec.

The decision of the Decision Makers under the Legislation and the derivatives legislation of Québec, as applicable, is that the Exemption Sought and Exemption Sought for Derivatives are granted, subject to the conditions below.

a) The Filers will serve only non-individual "permitted clients" as defined in Regulation 31-310 and that none of the clients of the Filers will be individuals;

b) All Representatives are subject to supervision by, and the applicable compliance requirements of, both Filers;

c) The CCO and the UDP of each Filer will ensure that all Representatives have sufficient time and resources to adequately serve each Filer and its respective clients;

d) The Filers each have adequate policies and procedures in place to address any potential conflicts of interest that may arise as a result of the dual registration of the Representatives and deal appropriately with any such conflicts; and

e) The relationship between the Filers and the fact that the Representatives are dually registered with both Filers is fully disclosed in writing to each client of the Filers that deal with the Representatives.

French version signed by:

"Éric Jacob"

Superintendent, Client Services and Distribution oversight

Autorité des marchés financiers

APPENDIX A

List of Existing Representatives