Securities Law & Instruments

Headnote

Application in connection with application for registration as an international dealer, for an order pursuant to section 211 of the Regulation exempting the applicants from the requirement in subsection 208(2) of the Regulation that they carry on the business of an underwriter in a country other than Canada to be able to register in Ontario as international dealers.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(1).

Regulations Cited

Regulation made under the Securities Act, R.R.O. 1990, Reg. 1015, as am., ss.100(3), 208(2), 211.

October 18, 2005

IN THE MATTER OF

THE SECURITIES ACT, R.S.O. 1990,

CHAPTER S. 5, AS AMENDED (the ACT)

AND

IN THE MATTER OF

ONTARIO REGULATION 1015, R.R.O. 1990,

AS AMENDED (the REGULATION)

AND

IN THE MATTER OF

KNIGHT EQUITY MARKETS, L.P.,

KNIGHT CAPITAL MARKETS, LLC AND

DIRECT TRADING INSTITUTIONAL L.P.

 

ORDER

(Section 211 of the Regulation)

UPON the application (the Application) of Knight Equity Markets, L.P., Knight Capital Markets, LLC and Direct Trading Institutional L.P. (the Applicants) to the Ontario Securities Commission for an order, pursuant to section 211 of the Regulation, exempting the Applicants from the requirement in subsection 208(2) of the Regulation that the Applicants carry on the business of an underwriter in a country other than Canada in order for the Applicants to each be registered under the Act as dealers in the category of international dealer;

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 Applicants have each filed an application for registration as a dealer under the Act, in the category of international dealer, in accordance with section 208 of the Regulation. The Applicants are not presently registered in any capacity under the Act.

2. Knight Capital Group Inc. is a public company listed on the NASDAQ and is the ultimate parent company of, and has ultimate control over, each of the Applicants.

3. Knight Equity Markets, L.P. is a corporation organized under the laws of the State of Delaware in the United States and its principal place of business is located in Jersey City, New Jersey.

4. Knight Capital Markets, LLC is a corporation organized under the laws of the State of Delaware and its principal place of business is located in Jersey City, New Jersey.

5. Direct Trading Institutional L.P. is a corporation organized under the laws of the State of Delaware and its principal place of business is located in Irving, Texas.

6. Each of the Applicants is registered in the U.S. as a broker-dealer with the U.S. Securities and Exchange Commission and is a member in good standing of the National Association of Securities Dealers, Inc.

7. Each of the Applicants carries on business of a broker-dealer in the U.S.

8. None of the Applicants currently act as an underwriter in the U.S. or in any other jurisdiction outside of the U.S.

9. In the absence of the relief requested in this Application, the Applicants would not meet the requirements of the Regulation for registration as dealers in the category of international dealer as they do not carry on the business of an underwriter in a country other than Canada.

10. The Applicants do not now act as underwriters in Ontario and will not act as underwriters in Ontario if they are registered under the Act as international dealers, despite the fact that subsection 100(3) of the Regulation provides that an international dealer is deemed to have been granted registration as an underwriter for the purposes of a distribution which it is permitted to make.

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

IT IS ORDERED, pursuant to section 211 of the Regulation, that, in connection with the registration of each of the Applicants as a dealer under the Act in the category of international dealer, the Applicants are exempt from the provisions of subsection 208(2) of the Regulation requiring that the Applicants carry on the business of an underwriter in a country other than Canada, provided that, so long as the Applicants are registered under the Act as international dealers:

(a) the Applicants carry on the business of a dealer in a country other than Canada; and

(b) notwithstanding subsection 100(3) of the Regulation, the Applicants shall not act as underwriters in Ontario.

"M. Theresa McLeod"
Commissioner
 
"Harold P. Hands"
Commissioner