Mackenzie Financial Corporation et al. - s. 144

Headnote

Application pursuant to section 144 of Securities Act (Ontario) (the Act) varying a decision previously granted to the filer dated July 7, 2006.

Application for an exemption pursuant to section 74(1) of the Act from the dealer registration requirements of subsection 25(1)(a), granted to a network of dealers of one Applicant, and for all Applicants non-Ontario registered Representatives trading on behalf of an Ontario charitable foundation as part of a charitable giving program.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25(1)(a), 74(1), s.144.

IN THE MATTER OF

THE SECURITIES ACT

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

(the Act)

AND

IN THE MATTER OF

MACKENZIE FINANCIAL CORPORATION

AND

INVESTORS GROUP FINANCIAL SERVICES INC.

AND

QUADRUS INVESTMENT SERVICES LTD.

VARIATION ORDER

(Section 144 of the Act)

UPON the application (the Application) of Mackenzie Financial Corporation (Mackenzie), Investors Group Financial Services Inc. (Investors) and Quadrus Investment Services Ltd. (Quadrus, and together with Investors and Mackenzie, the Applicants) to the Ontario Securities Commission (the Commission) for an order pursuant to section 144 of the Act varying an order and ruling granted by the Commission to the Applicants on July 7, 2006 (the Prior Order), pursuant to subsection 74(1) of the Act that the dealer registration requirements contained in subsection 25(1)(a) of the Act (the Dealer Registration Requirements) shall not apply to:

(a) Mackenzie, and its network of third party dealers (the Mackenzie Network Dealers) when engaged in registrable activities on behalf of the Strategic Charitable Giving Foundation (the Foundation) as part of the Charitable Giving Programs (as described below); and

(b) the salespersons, investment representatives, consultants, or financial advisers (collectively the Representatives) of the Applicants and the Mackenzie Network Dealers, in respect of trading on behalf of the Foundation and the Charitable Giving Programs;

AND UPON the Applicant having represented to the Commission that:

The Foundation

1. The Foundation, formed by the Applicants, is an independent non-profit charitable organization with registered charitable status as a public foundation under the Income Tax Act (Canada) (the Tax Act). The head office of the Foundation is in Ontario.

2. The purpose of the Foundation is to support charities and other permitted entities as defined under the Tax Act (Qualified Donees) through charitable gifts received from donors. The Foundation specializes in the management and administration of donor-advised charitable gift funds and has, or will, enter into agreements with each of the Applicants to establish charitable giving programs (Charitable Giving Programs).

Mackenzie

3. Mackenzie is a corporation governed by the laws of Ontario. Mackenzie is registered as an adviser in the categories of investment counsel and portfolio manager in each of Ontario, Manitoba and Alberta, as a dealer in the category of limited market dealer in Ontario and also as a commodity trading counsel & commodity trading manager in Ontario.

4. Mackenzie is an affiliate of both Investors and Quadrus.

5. Mackenzie, pursuant to a charitable administration services agreement with the Foundation, will serve as the Foundation's charitable administrative services provider to assist with the charitable back-office functions for all of the Foundation's Charitable Giving Programs.

6. Mackenzie is not a registered mutual fund dealer or investment dealer in Ontario and does not have an internal team of Representatives to serve as its sales force. Instead Mackenzie relies upon the Mackenzie Network Dealers, a diversified network of third party Representatives and their sponsoring mutual fund dealer or investment dealer firms to distribute its products.

Investors

7. Investors is a corporation governed by the laws of Canada and Investors is registered as a dealer in the category of mutual fund dealer, or equivalent, in all provinces and territories of Canada, as a limited market dealer in Ontario and is a member of the Mutual Fund Dealers Association of Canada (the MFDA). Investors distributes its services through a sales force of Representatives that are independent contractors registered exclusively with Investors under applicable legislation in various provinces and territories of Canada.

Quadrus

8. Quadrus is a corporation governed by the laws of Canada and Quadrus is registered as a dealer in the category of mutual fund dealer in all provinces and territories of Canada, and as a limited market dealer in Ontario and is a member of the MFDA.

The Charitable Giving Programs

9. Prospective charitable donors to the Foundation will, prior to making a donation, receive a program guide (a Program Guide) which will outline the details of the operation of the Charitable Giving Program and its fees.

10. Donors make an irrevocable charitable gift of cash, securities and/or insurance to the Foundation (a Donor) and receive a tax receipt generally equal to the cash, or fair market value of securities, donated to the Foundation. Securities donated to the Foundation will be liquidated through an investment dealer affiliated with the Applicants.

11. The Foundation will deposit the proceeds of each Donor's gift into an individual account which it will open with whichever of Investors, Quadrus or one of the Mackenzie Network Dealers is the sponsoring dealer firm of the Representative servicing the account (as described in paragraph 15 below)(each, an Account).

12. The Foundation's Board of Directors will pre-select a list of mutual funds offered by each of the respective Applicants for their respective Charitable Giving Program (the Eligible Funds) and every Account opened as a result of a donation to a Charitable Giving Program will be restricted to investments in the Eligible Funds of that Charitable Giving Program. Each of the Eligible Funds will be a mutual fund governed under the laws of Ontario or Manitoba, qualified by way of a National Instrument 81-101 (NI 81-101) simplified prospectus. Each of the Eligible Funds is expected to be categorized as either a Canadian or Global Fixed Income or Balanced Fund.

13. Each Charitable Giving Program will generally require that 95% of each donation be subject to a ten year hold period by the Foundation. During the hold period, each Account will have an annual disbursement percentage determined by the Foundation, which must be disbursed to Qualified Donees each year. After the hold period, if the Donor wishes, the annual disbursement percentage may be increased by the Foundation.

14. Donors will recommend to the Foundation what an Account should be named and what Qualified Donees should be supported by the Account. Each Account will have a designated account holder (the Account Holder). While the Account Holder will usually be the Donor, the Donor may designate another person, or a legal representative, to be the Account Holder for the Account set up with their donation. The Account Holder will be responsible for providing the Foundation advice regarding the disbursements from the Account to Qualified Donees, and will be provided an opportunity to express a preference regarding which Eligible Fund the Account should be invested in, through the Representative servicing the Account, to the Foundation.

15. The Representative that solicits the Donor's gift to the Foundation will have an ongoing relationship with the Donor or Account Holder and will service the Account set up with the proceeds of that Donor's gift. The Representative, with input from the Account Holder, will initially recommend to the Board which Eligible Fund the Account should invest in, and provide any future recommendations on changes to which Eligible Fund the Account is invested in.

16. The Foundation will have final authority over all investment decisions in each of the Accounts. After receiving a recommendation from the Representative, the Foundation will make a final decision on the investment for that Account, and will send trading instructions to the Representative servicing that Account.

17. All Investors, Quadrus and the Mackenzie Network Dealers, will be appropriately registered in the province or territory of residence of the Donor or Account Holder.

18. All Investors, Quadrus and Mackenzie Network Dealers, other than those who are based in Quebec and registered solely with the Autorité des marchés financiers (AMF), will be members of either the MFDA or the Investment Dealers Association of Canada (the IDA).

19. Mackenzie is not a registered mutual fund dealer or investment dealer in Ontario, and certain Mackenzie Network Dealers may not be registered mutual fund dealers or investment dealers in Ontario, and therefore require relief from the Dealer Registration Requirements in order to conduct registrable activities on behalf of a Foundation Account.

20. All Representatives will be appropriately registered in the province or territory of residence of the Donor or Account Holder.

21. All Representatives, other than those who are based in Quebec and registered solely with the AMF, will be registered as either an Approved Person with the MFDA or a Registered Representative with the IDA.

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

IT IS ORDERED pursuant to section 144 of the Act, the Commission hereby varies the Prior Order by replacing paragraph (ii) of the Prior Order with the following:

(ii) each of the Mackenzie Network Dealers undertaking registerable activities on behalf of the Foundation, other than the Mackenzie Network Dealers that are based in Quebec and are registered solely with the AMF, is a member of either the MFDA or IDA;

AND IT IS ORDERED pursuant to section 144 of the Act, that paragraph (iv) of the Prior Order is replaced with the following:

(iv) each of the Representatives undertaking registerable activities on behalf of the Foundation, other than the Representatives that are based in Quebec and are registered solely with the AMF, shall be either an MFDA Approved Person or an IDA Registered Representative.

April 25, 2008