Sinopia Asset Management S.A. - s. 80

The Applicant will act as a sub-adviser to clients of HSBC Global Asset Management (Canada) Limited. Relief granted to permit the Applicant to provide advice and portfolio management services from the adviser registration requirements of subsection 22(1)(b) of the CFA. Relief granted to sub-advisers not ordinarily resident in Ontario in respect of advice regarding trades in commodity futures contracts and commodity futures options traded primarily on commodity futures exchanges outside Canada and cleared primarily through clearing houses outside Canada, subject to certain terms and conditions, for a period of five years. Relief mirrors exemption available in section 7.3 of Ontario Securities Commission Rule 35-502 -- Non Resident Advisers.

Statutes Cited

Commodity Futures Act, R.S.O. 1990, c. C. 20, as am., ss. 22(1)(b), 80.

Securities Act, R.S.O. 1990, c. S.5, as am. -- Rule 35-502 -- Non Resident Advisers, s. 7.3.

IN THE MATTER OF

THE COMMODITY FUTURES ACT,

R.S.O. 1990, CHAPTER C.20, AS AMENDED (the CFA)

AND

IN THE MATTER OF SINOPIA ASSET MANAGEMENT S.A.

ORDER

(Section 80 of the CFA)

UPON the application (the Application) of Sinopia Asset Management S.A. (the Applicant) to the Ontario Securities Commission (the Commission or OSC) for an order pursuant to section 80 of the CFA that the Applicant and its directors, officers and employees acting on its behalf as an adviser be exempt from the adviser registration requirement in subsection 22(1)(b) of the CFA in respect of advice and portfolio management services provided for the benefit of certain clients of HSBC Global Asset Management (Canada) Limited (AMCA), formerly HSBC Investments (Canada) Limited, resident in Ontario (the Clients) in respect of trades in commodity futures contracts and commodity futures options (collectively, Contracts) traded primarily on commodity futures exchanges outside Canada and cleared primarily through clearing houses outside Canada; and

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

AND UPON the Applicant having represented to the Commission that:

1. The Applicant is a corporation organized under the laws of France, with a head office located in Paris, France. The Applicant does not have an office in Canada and has no directors, officers or employees resident in Canada.

2. The Applicant is registered to provide investment counselling and portfolio management services as an Investment Management Company (Société de Gestion) with the Autorité des Marchés Financiers, which governs the Applicant's securities and commodities futures activities in France. The Applicant is not registered and does not intend to become registered in any capacity under the CFA or under applicable securities legislation in any other Canadian jurisdiction.

3. AMCA is a corporation organized under the Canada Business Corporations Act, with a head office located in Vancouver, British Columbia. AMCA is a subsidiary of HSBC Bank Canada, and an affiliate of the Applicant. AMCA is registered under the Securities Act (Ontario) (the OSA) as an adviser in the categories of investment counsel and portfolio manager and in equivalent categories in all other Canadian provinces, other than Prince Edward Island. AMCA is also registered under the OSA as a dealer in the category of limited market dealer.

4. AMCA acts as an adviser to Clients and, from time to time, advises Clients to invest in futures and options on futures traded on Canadian or other organized exchanges outside of Canada and in other derivative instruments traded over-the-counter. AMCA provides discretionary and other portfolio management and investment advisory services to retail clients, institutional and high net worth private clients. AMCA also acts as the manager of the HSBC Pooled Funds, a family of public mutual funds that are principally sold to investors as part of a discretionary management service offered by AMCA. In respect of commodity futures related advice, AMCA and its directors, officers and employees rely on subsection 31(d) of the CFA, which provides registration relief for persons registered under the OSA whose services as advisers, for purposes of the CFA, are solely incidental to their principal business.

5. AMCA wishes to retain the Applicant as a sub-adviser to provide portfolio management services to Clients. In providing portfolio management services to Clients, the Applicant may advise Clients with respect to Contracts.

6. There is presently no rule under the CFA that provides an exemption from the adviser registration requirement in paragraph 22(1)(b) of the CFA for a person or company acting as an adviser in respect of commodity futures contracts and commodity futures options that is similar to the exemption from the adviser registration requirement in section 25(1)(c) of the OSA for acting as an adviser (as defined in the OSA) in respect of securities that is provided under section 7.3 of Ontario Securities Commission Rule 35-502 -- Non Resident Advisers (OSC Rule 35-502).

7. As would be required under section 7.3 of OSC Rule 35-502:

(a) the obligations and duties of the Applicant will be set out in a written agreement with AMCA;

(b) AMCA will contractually agree with Clients on whose behalf the investment advice is or portfolio management services are to be provided by the Applicant, to be responsible for any loss that arises as a result of the Applicant or its directors, officers and employees failing to:

(i) exercise their powers and discharge the duties of their office honestly, in good faith and in the best interests of AMCA and each Client of AMCA for whose benefit the advice is or portfolio management services are to be provided, or

(ii) exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances; and

(c) AMCA cannot be relieved by Clients from its responsibility for loss as described in paragraph (b) above.

8. AMCA will establish the same relationship with the Applicant when providing the Applicant's portfolio management services in respect of Contracts, as it establishes with the Applicant pursuant to the requirements of section 7.3 of OSC Rule 35-502.

9. The Clients will receive disclosure that AMCA, as the principal investment adviser, will be responsible to the Clients for the services provided by the Applicant, and to the extent applicable, there may be difficulty in enforcing any legal rights against the Applicant because it is resident outside of Canada and as all or a substantial portion of its assets are situated outside of Canada.

AND UPON being satisfied that it would not be prejudicial to the public interest for the Commission to grant the exemption requested on the basis of the terms and conditions proposed;

IT IS ORDERED pursuant to section 80 of the CFA, that the Applicant and its directors, officers and employees be exempt from the requirements of subsection 22(1)(b) of the CFA in respect of advice and portfolio management services provided for the benefit of AMCA and Clients in respect of Contracts traded primarily on commodity futures exchanges outside Canada and cleared primarily through clearing houses outside Canada, subject to the following terms:

(a) the obligations and duties of the Applicant are set out in a written agreement with AMCA;

(b) AMCA contractually agrees with Clients on whose behalf the portfolio management services of the Applicant, its directors, officers and employees are to be provided, to be responsible for any loss that arises out of the failure of the Applicant, its directors, officers or employees:

(i) to exercise the powers and discharge the duties of its office honestly, in good faith and in the best interests of AMCA and each Client for whose benefit the advice is or portfolio management services are to be provided; or

(ii) to exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances'

(c) AMCA cannot be relieved by any Client from its responsibility for loss under paragraph (b) above;

(d) The Applicant is registered as an Investment Management Company (Société de Gestion) with the Autorité des Marchés Financiers in France;

(e) AMCA is registered as an investment counsel and portfolio manager under the OSA;

(f) The Client will receive disclosure that AMCA, as the principal investment adviser to the Clients, will be responsible to the Client for the services provided by the Applicant, and to the extent applicable, there may be difficulty in enforcing any legal rights against the Applicant because it is resident outside of Canada and as all or a substantial portion of its assets are situated outside of Canada; and

(g) This Order shall terminate on the day that is five years after the date of the Order.

July 15, 2008