Fidelity Currency Hedged Global Bond Trust et al. - s. 113

September 15, 2006

IN THE MATTER OF

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

c. S.5, AS AMENDED

(the "Act")

AND

IN THE MATTER OF

FIDELITY CURRENCY HEDGED GLOBAL BOND TRUST

FIDELITY CURRENCY HEDGED EMERGING MARKETS DEBT TRUST

FIDELITY CANADIAN BOND CORE PLUS TRUST

(collectively, the "Fidelity Funds")

ORDER

(Section 113 of the Act)

Background

The Ontario Securities Commission (the "Commission") has received an application from Fidelity Investments Canada Limited ("Fidelity") on behalf of the Fidelity Funds and such other pooled funds which Fidelity may manage from time to time (together with the Fidelity Funds, the "Pooled Funds") for an order under section 113 of the Act exempting the Pooled Funds from the investment prohibitions in paragraph 111(2)(b) and subsection 111(3) of the Act which prohibit a mutual fund from knowingly making or holding an investment in a person or company in which the mutual fund, alone or together with one or more related mutual funds, is a substantial securityholder (the "Requested Relief").

Representations

1. Fidelity is a corporation incorporated under the laws of Canada, thereafter continued under the laws of Ontario, and subsequently amalgamated under the laws of Ontario. The head office of Fidelity is located in Toronto, Ontario.

2. Fidelity is registered under the Act as a dealer in the category of mutual fund dealer and as an adviser in the categories of investment counsel and portfolio manager, and under The Commodity Futures Act (Ontario) ("CFA") as an adviser in the category of commodity trading manager.

3. The Fidelity Funds were established under the laws of the Province of Ontario by way of a trust agreement dated September 14, 2006.

4. Fidelity is, or will be, the manager and principal distributor, and in some instances also the trustee and portfolio adviser, of the Pooled Funds which are or will be sold solely in Canada's private placement markets in accordance with National Instrument 45-106 Prospectus and Registration Exemptions ("NI 45-106").

5. Fidelity intends to cause the Pooled Funds to make investments in:

(a) units of a Pooled Fund, and/or

(b) units of existing and/or future retail mutual funds qualified for distribution in Canada under a simplified prospectus and annual information form for which Fidelity is or will be both manager and trustee (collectively, the "Retail Mutual Funds"), and/or

(c) securities of open-ended investment companies located outside Canada managed by an affiliate of Fidelity or FIL (defined below) (collectively, the "International Funds").

In this Order, each Pooled Fund that invests in units of another Pooled Fund and/or Retail Mutual Fund and/or International Fund is referred to as a "Top Fund" and the Pooled Fund and/or Retail Mutual Fund and/or International Fund that a Top Fund invests in is referred to as an "Underlying Fund".

6. The Pooled Funds and the International Funds will not be reporting issuers in any jurisdiction in Canada and, to the knowledge of Fidelity, none of the Pooled Funds or Retail Mutual Funds are, nor is it anticipated that they will be, in default of any requirements under the Act.

7. Pyramis Global Advisors, LLC ("Pyramis"), Fidelity, or one of their affiliates is or will be the portfolio adviser of certain of the Pooled Funds and Retail Mutual Funds. Pyramis, an affiliate of Fidelity, is a limited liability company organized under the laws of the State of Delaware and is resident in the United States of America. Pyramis is registered as an investment adviser with the United States Securities and Exchange Commission and as a non-Canadian adviser and commodity trading manager with the Commission.

8. The following entities (collectively, the "Sub-Advisers"), all affiliates of Fidelity and Pyramis (with the exception of FIL which is a joint actor), may be engaged by Pyramis or Fidelity from time to time as sub-advisers to certain of the Pooled Funds, Retail Mutual Funds and International Funds:

(a) Pyramis Global Advisors Trust Company, Inc., ("PGAT"), a limited purpose trust company chartered under the laws of the State of New Hampshire and resident in the United States of America;

(b) Fidelity Management Trust Company, Inc., ("FMTC"), a trust company chartered under the laws of the Commonwealth of Massachusetts and resident in the United States of America;

(c) Fidelity Investment Money Management, Inc., ("FIMM"), a corporation organized under the laws of the State of New Hampshire and resident in the United States of America;

(d) FMR Co., Inc., ("FMR"), a corporation organized under the laws of the Commonwealth of Massachusetts and resident in the United States of America; and

(e) Fidelity International Limited, ("FIL"), a corporation organized under the laws of Bermuda and is resident in Bermuda.

9. Each of the Sub-Advisers obtained an exemption from the Commission from the requirements of paragraph 22(1)(b) of the CFA in respect of advising certain Retail Mutual Funds and Pooled Funds in Ontario.

10. None of PGAT, FMTC, FIMM or FMR are required to be registered with the U.S. Commodity Futures Trading Commission as a commodity trading adviser nor are they required to be a member of the National Futures Association - nor is FIL registered pursuant to any commodity futures trading legislation in Bermuda nor is such registration required - in order for any of them to provide advisory services in connection with the purchase and sale of commodity futures contracts or related products on commodity futures exchanges that are cleared through acceptable clearing corporations.

11. The respective investment objectives of the Fidelity Funds are as follows:

(a) Fidelity Currency Hedged Global Bond Trust seeks income and capital growth. The fund invests primarily in units of Fidelity Global Bond Trust, a Pooled Fund that invests primarily in fixed income securities issued by companies located anywhere in the world. The fund will also use derivatives to hedge against fluctuations in the value of developed market currencies relative to the Canadian dollar.

(b) Fidelity Currency Hedged Emerging Markets Debt Trust seeks to achieve income and capital appreciation by investing primarily in Fidelity Funds - Emerging Markets Debt Fund, an International Fund that invests primarily in global emerging markets debt securities and which may also invest in other types of securities, including local market debt instruments, fixed income, equity securities and corporate bonds of emerging market issuers, and lower quality debt securities. Investments by the fund will be made within, although not limited to, Latin America, South East Asia, Africa, Eastern Europe (including Russia) and the Middle East. The fund will also use derivatives to hedge against fluctuations in the value of the U.S. dollar.

(c) Fidelity Canadian Bond Core Plus Trust seeks returns that exceed the Scotia Capital Universe Bond Index through direct or indirect investments in investment-grade and non-investment grade fixed income securities issued by companies anywhere in the world. The fund will invest:

(i) in units of Fidelity Canadian Bond Trust, an existing Pooled Fund established under the laws of the Province of Ontario, the investment objective of which is to generate returns that exceed the Scotia Capital Universe Bond Index. The fund invests primarily in a well-diversified portfolio of Canadian dollar denominated debt securities;

(ii) in units of Fidelity Currency Hedged Global Bond Trust described in paragraph 11(a) above;

(iii) in units of Fidelity Currency Hedged Emerging Markets Debt Trust described in paragraph 11(b) above; and

(iv) in units of Fidelity American High Yield Fund, a Retail Mutual Fund currently qualified for distribution in all of the provinces and territories of Canada under a simplified prospectus and annual information form dated October 18, 2005. The fund aims to achieve a combination of a high level of income and the potential for capital gains. It invests primarily in higher yielding, lower quality fixed-income securities, preferred stocks and convertible securities issued by U.S. companies.

Fidelity Canadian Bond Core Plus Trust may also invest directly in investment-grade and non-investment grade fixed income securities issued by companies anywhere in the world and it may also enter into currency swap contracts.

12. When causing a Top Fund to make investments in the Underlying Funds, Fidelity will ensure that:

(a) the arrangements between or in respect of a Top Fund and an Underlying Fund are such as to avoid the duplication of management fees or incentive fees (if any);

(b) no sales or redemption fees are payable by a Top Fund in relation to its purchases or redemptions of units of an Underlying Fund;

(c) Fidelity will not vote the units of an Underlying Fund held by a Top Fund at any meeting of holders of such units;

(d) investors will receive details of the investment objective and strategies of an Underlying Fund prior to entering into agreements for the provision of investment management services pursuant to which the investors may invest in units of the Top Fund; and

(e) where a Top Fund is substantially invested in an Underlying Fund, the annual and interim financial statements of the Top Fund will list the 25 largest holdings of the Underlying Fund by percentage of assets of that fund.

13. In the absence of the Requested Relief, each Top Fund would be precluded from investing in the Underlying Funds due to the investment prohibitions in paragraph 111(2)(b) and subsection 111(3) of the Act.

14. A Top Fund's investments in the Underlying Funds represent the business judgement of responsible persons uninfluenced by considerations other than the best interests of the Top Fund.

Order

The Commission is satisfied that the test contained in section 113 of the Act has been met.

The Commission orders that the Requested Relief is granted provided that:

1. units of a Top Fund are sold solely in Canada's private placement markets in accordance with NI 45-106;

2. the arrangements between or in respect of a Top Fund and an Underlying Fund are such as to avoid the duplication of management fees or incentive fees (if any);

3. no sales or redemption fees are payable by a Top Fund in relation to its purchases or redemptions of units of an Underlying Fund;

4. Fidelity will not vote the units of an Underlying Fund held by a Top Fund at any meeting of holders of such units;

5. investors will receive details of the investment objective and strategies of an Underlying Fund prior to entering into agreements for the provision of investment management services pursuant to which the investors may invest in units of the Top Fund ; and

6. where a Top Fund is substantially invested in an Underlying Fund, the annual and interim financial statements of the Top Fund will list the 25 largest holdings of the Underlying Fund by percentage of assets of that fund.