Securities Law & Instruments

Headnote

Mutual Reliance Review System for ExemptiveRelief Applications - National Instrument 33-105, section 5.1and equivalent Quebec legislation - issuer is related issuerand therefore connected issuer of sole underwriter - no independentunderwriter involvement subject to certain conditions, includingparticipation of an arm's length party in the negotiation ofthe material terms of the offering, the drafting of the prospectus,the due diligence relating to the offering, the pricing of thesecurities and the disclosure of such information and the relationshipbetween the issuer and the underwriter in the prospectus.

Rules Cited

National Instrument 33-105 Underwriting Conflicts,ss. 5.1, 2.1.
Form 44-101F3 Short Form Prospectus.

IN THE MATTER OF
THE SECURITIES LEGISLATION
OF ONTARIO, BRITISH COLUMBIA,
ALBERTA, QUÉBEC, NOVA SCOTIA,
PRINCE EDWARD ISLAND AND
NEWFOUNDLAND AND LABRADOR

AND

IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM FOR
EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF
MERRILL LYNCH FINANCIAL ASSETS INC.
(formerly MERRILL LYNCH MORTGAGE LOANS INC.)
AND MERRILL LYNCH CANADA INC.

MRRS DECISION DOCUMENT

WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") in eachof Ontario, British Columbia, Alberta, Québec, Nova Scotia,Prince Edward Island and Newfoundland and Labrador (the "Jurisdictions")has received an application from Merrill Lynch Financial AssetsInc. (formerly Merrill Lynch Mortgage Loans Inc.) (the "Issuer")and Merrill Lynch Canada Inc. ("ML Canada") (the Issuerand ML Canada are collectively referred to herein as the "Filer")for a decision pursuant to section 5.1 of National Instrument33-105 Underwriting Conflicts (the "National Instrument")and section 263 of the Securities Act (Quebec) (the "QuebecAct") (collectively, the "Legislation") thatthe provision contained in section 2.1 of the National Instrumentand sections 236.1 and 237.1 of the regulation to the QuebecAct mandating independent underwriter involvement shall notapply to ML Canada and the Issuer in respect of the proposedoffering (the "Offering") of the AmeriCredit Certificates(as defined below);

AND WHEREAS pursuant to the Mutual RelianceReview System for Exemptive Relief Applications (the "MRRS")the Ontario Securities Commission is the principal regulatorfor this Application;

AND WHEREAS it has been representedby the Filer to the Decision Makers that:

1. the Issuer was incorporated under the lawsof Canada on March 13, 1995; effective March 15, 2001, the Issuerchanged its name from Merrill Lynch Mortgage Loans Inc. to MerrillLynch Financial Assets Inc.; the authorized share capital ofthe Issuer consists of an unlimited number of common shares,of which 1,000 common shares are issued and outstanding, allof which are held by Merrill Lynch & Co., Canada Ltd. ("ML& Co."); the head office of the Issuer is located inToronto, Ontario;

2. to date the Issuer has issued 600,000,000S&P BULLS (the "S&P 500 Bulls"), $182,083,237(initial certificate balance) of pass-through certificates ofwhich $163,874,000 (initial certificate balance) were designatedas Exchangeable Commercial Mortgage Pass-Through Certificates,Series 1998 - Canada 1, $163,874,000 (initial certificate balance)Commercial Mortgage Pass-Through Certificates, Series 1998-Canada1 (the "C-1 Certificates"), $193,741,000 (initialcertificate balance) of Commercial Mortgage Pass-Through Certificates,Series 1999-Canada 2 (the "C-2 Certificates"), $220,000,000(initial certificate balance) of 1st Street Tower Pass-ThroughCertificates (the "Tower Certificates"), approximately$227,324,000 (initial certificate balance) of Commercial MortgagePass-Through Certificates, Series 2000-Canada 3 (the "C-3Certificates"), approximately $115,500,000 (initial certificatebalance) of BMCC Corporate Centre Pass-Through Certificates,Series 2000-BMCC (the "BMCC Certificates"), approximately$255,981,000 (initial certificate balance) of Commercial MortgagePass-Through Certificates, Series 2000-Canada 4 (the "C-4Certificates"), approximately $187,680,000 (initial certificatebalance) of Commercial Mortgage Pass-Through Certificates, Series2001-LBC (the "LBC Certificates"), approximately $221,990,000(initial certificate balance) of Commercial Mortgage Pass-ThroughCertificates, Series 2001-Canada 5 (the "C-5 Certificates")and approximately $236,954,000 (initial certificate balance)of Commercial Mortgage Pass-Through Certificates, Series 2001-Canada6 (the "C-6 Certificates");

3. on January 28, 2002, the Issuer filed a preliminaryshort form base PREP prospectus and on February 5, 2002 theIssuer filed a prospectus supplement in connection with theoffering of $100,000,000 (initial certificate balance) of CommercialMortgage Pass-Through Certificates, Series 2002-BC2P;

4. the Issuer filed a renewal annual informationform on May 18, 2001;

5. the Issuer has been a "reporting issuer"pursuant to the securities legislation in each of the provincesof Canada for over 12 calendar months and is not in defaultof the Legislation. Pursuant to a decision dated November 30,2000 of the Decision Makers of Ontario, British Columbia, Alberta,Newfoundland, Nova Scotia and Saskatchewan, as amended, (the"November 30, 2000 Decision"), the Issuer has beengranted certain relief in connection with the requirement insecurities legislation of such jurisdictions to make continuousdisclosure of its financial results, and from other forms ofcontinuous disclosure required under such legislation, providedthat the Issuer complies with the conditions set out in theNovember 30, 2000 Decision;

6. the Issuer currently has no assets or liabilitiesother than its rights and obligations under certain of the materialcontracts related to the C-1 Certificates, the C-2 Certificates,the C-3 Certificates, the C-4 Certificates, the C-5 Certificates,the C-6 Certificates, the LBC Certificates, the Tower Certificatesand the BMCC Certificates transactions and does not presentlycarry on any activities except in relation to the C-1 Certificates,the C-2 Certificates, the C-3 Certificates, the C-4 Certificates,the C-5 Certificates, the C-6 Certificates, the LBC Certificates,the Tower Certificates and the BMCC Certificates;

7. the officers and directors of the Issuerare employees of ML Canada or its affiliates;

8. ML Canada was continued and amalgamated underthe laws of Canada on August 26, 1998; the authorized sharecapital of ML Canada consists of an unlimited number of commonshares; the common shares of ML Canada are owned by ML &Co. and Midland Walwyn Inc; the head office of ML Canada islocated in Toronto, Ontario;

9. ML Canada is not a reporting issuer in anyCanadian province;

10. ML Canada is registered as a dealer in thecategories of "broker" and "investment dealer"and is a member of the Investment Dealers Association of Canada;

11. the Issuer proposes to offer AmeriCreditCanada Automobile Receivables Pass-Through Certificates, Series2002-A (the "AmeriCredit Certificates"), issuablein classes, with an Approved Rating by an Approved Rating Organization,as those terms are defined in the Legislation with respect toshort form prospectus distributions, to the public in Canada,to finance the purchase by the Issuer from AmeriCredit FinancialServices of Canada Limited ("AmeriCredit") or an affiliateor subsidiary thereof and from other originators of automobileloans as may be specified in the prospectus in respect of theAmeriCredit Certificates of ownership interests in particularautomobile loans deposited with BNY Trust Company of Canadaas custodian; each AmeriCredit Certificate will represent anundivided co-ownership interest in a particular pool of automobileloans;

12. AmeriCredit is a corporation incorporatedunder the laws of Ontario and is not a reporting issuer pursuantto the securities legislation in any of the provinces or territoriesin Canada. AmeriCredit is an independent arm's length partyof ML Canada and the Issuer.

13. the proceeds of the sale of the automobileloans by AmeriCredit will be used by AmeriCredit to financeits existing business;

14. ML Canada proposes to act as the underwriterin connection with the distribution of 100% of the dollar valueof the distribution for the proposed Offering;

15. all material terms of the AmeriCredit Certificatesand the Offering will be negotiated on an arm's length basisbetween AmeriCredit and ML Canada; AmeriCredit will participatein the drafting of the preliminary prospectus and prospectusin connection with the Offering, the due diligence relatingto the Offering and in the pricing of the Offering;

16. the only financial benefits which ML Canadawill receive as a result of the proposed Offering are the normalarm's length underwriting commission, structuring fee and reimbursementof expenses associated with a public offering in Canada, whichcommissions and reimbursements shall for the purposes of thisDecision be deemed to include the increases or decreases contemplatedby Section 1.5(b) of Form 44-101F3 Short Form Prospectus andby the applicable securities legislation in Québec;

17. ML Canada administers the ongoing operationsand pays the ongoing operating expenses of the Issuer, for whichML Canada receives no additional compensation;

18. the Issuer may be considered to be a related(or equivalent) issuer (as defined in the Legislation) and thereforea connected (or equivalent) issuer (as defined in the Legislation)of ML Canada for the purposes of the proposed Offering because:
(a) both ML Canada and the Issuer are subsidiaries of ML &Co.;

(b) the officers of the Issuer are employeesof ML Canada or its affiliates;

(c) ML Canada administers the on-going operationsof the Issuer;

19. in connection with the proposed distributionby ML Canada of 100% of the AmeriCredit Certificates of theIssuer, the preliminary and final prospectus and the prospectussupplement of the Issuer shall contain the following information:

(a) on the front page of each such document,

(i) a statement, naming ML Canada, in bold typewhich states that the Issuer is a related or connected issuerof ML Canada in connection with the distribution,

(ii) a summary, naming ML Canada, stating thebasis upon which the Issuer is a related or connected issuerof ML Canada, and

(iii) a cross-reference to the applicable sectionin the body of the document where further information concerningthe relationship between the Issuer and ML Canada is provided,

(b) in the body of each such document,

(i) a statement, naming ML Canada, setting outthat the Issuer is a related or connected issuer of ML Canadain connection with the distribution,

(ii) the basis on which the Issuer is a relatedor connected issuer to ML Canada, including details of the commonownership by ML & Co. of ML Canada and the Issuer, and otheraspects of the relationship between ML Canada and the Issuer,

(iii) disclosure regarding the involvement ofML Canada in the decision to distribute the AmeriCredit Certificatesand the determination of the terms of the distribution,

(iv) details of the financial benefits describedin paragraph 16 of this Decision Document which ML Canada willreceive from the proposed Offering, and

(v) disclosure detailing the arm's length negotiationbetween AmeriCredit and ML Canada and participation of AmeriCreditin the drafting of the preliminary prospectus and prospectusin connection with the Offering, the due diligence relatingto the Offering and the pricing of the Offering as describedin paragraph 15 above;

AND WHEREAS pursuant to the MRRS thisDecision Document evidences the decision of each Decision Maker(collectively, the "Decision");

AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makerspursuant to the Legislation is that the requirement containedin the Legislation mandating independent underwriter involvementshall not apply to ML Canada and the Issuer in connection withthe Offering provided:

(a) AmeriCredit participates in the Offeringas stated in paragraph 15 above; and

(b) AmeriCredit's participation on the Offeringand the relationship between the Issuer and ML Canada are disclosedin the preliminary prospectus, the prospectus and the prospectussupplement as stated in paragraph 19 above.

April 2, 2002.

"Paul M. Moore"      "Robert W. Korthals"