Units of investment trusts, created under the laws of Nova Scotia, that invest in "foreign securities" as defined in subsection 204(1) of the Regulation are designated, pursuant to subsection 204(3) of the Regulation, as "foreign securities" for the purposes of the definition of "foreign securities" in subsection 204(1) of the Regulation provided that the Funds do not invest in any securities that are not "foreign securities" as defined in subsection 204(1) of the Regulation except in circumstances where it is appropriate to invest in Canadian money market instruments in order to provide liquidity and where such investment would be incidental to the principal investment objectives of the Funds.
Securities Act, R.S.O. 1990, c. S.5, as am.
Regulation made under the Securities Act, R.R.O. 1990, Reg. 1015, as am., ss. 204(1), 204(3).
IN THE MATTER OF
THE SECURITIES ACT, R.S.O. 1990,
CHAPTER S.5, AS AMENDED (the Act)
IN THE MATTER OF
R.R.O. 1990, REGULATION 1015,
AS AMENDED (the Regulation)
IN THE MATTER OF
(Subsection 204(3) of the Regulation)
UPON the application of UBS AG (UBS) to the Ontario Securities Commission (the Commission) that pursuant to subsection 204(3) of the Regulation, units of certain UBS (Canada) Pooled Funds (the Funds) managed by UBS Global Asset Management (Canada) Co. (the Manager) and established under the laws of a province of Canada be designated as "foreign securities" for the purposes of subsection 204(1) of the Regulation;
AND UPON considering the application and the recommendation of the staff of the Commission;
AND UPON the UBS having represented to the Commission as follows:
1. UBS is incorporated under the laws of Switzerland and is registered under the Act as a dealer in the category of international dealer and proposes to act as distributor of units of the Funds.
2. The Manager is incorporated under the laws of Nova Scotia and is registered in Ontario as a dealer in the category of limited market dealer, commodity trading manager, and as an adviser in the category of investment counsel and portfolio manager. The Manager has the exclusive power to manage and direct the investment of the property of the Funds.
3. UBS Global Asset Management (Americas) Inc. is incorporated under the laws of the State of Delaware in the United States, is a registered as an investment adviser with the U.S. Securities and Exchange Commission, and is engaged by the Manager pursuant to an exemption from registration for a sub-adviser in Section 7.3 of Commission Rule 35-502 -- Non Resident Advisers.
4. The Funds are, or will be, established under a Trust Agreement (the Agreement) between either RBC Dexia Investors Services Trust or CIBC Mellon Trust Company as trustee (the Trustee), and the Manager. The Trustee (or a successor trust company licensed to carry on business as a trust company in Canada or Ontario) will be the trustee of the Funds.
5. The Funds' assets will primarily consist of transferable securities listed on a stock exchange or traded in a regulated market in the U.S. and other foreign jurisdictions. The Funds may also engage in foreign currency contracts, foreign currency future and related options. A portion of the assets of the Funds may be held from time to time in short term Canadian money market instruments for purposes of providing liquidity to the Funds, but it will otherwise be invested in foreign securities. The Funds will not hold Canadian securities unless it is solely incidental to its holding of foreign securities.
6. In order for UBS to be able to offer units of the Funds in Ontario through its registration as an international dealer, the units of the Funds must be considered "foreign securities" within the meaning of subsection 204(1) of the Regulation.
7. Although the units of the Funds will represent an interest primarily in foreign securities, the units would not be foreign securities under the definition of "foreign security" in subsection 204(1) of the regulation because the units are securities of issuers formed under the laws of a province of Canada.
8. UBS proposes to sell units of the Funds to "designated institutions" as defined in subsection 204(1) of the Regulation, pursuant to clause 208(1)(d) of the Regulation, but may only do so if the units are designated as "foreign securities" under subsection 204(1) of the Regulation.
AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;
IT IS ORDERED THAT pursuant to subsection 204(3) of the Regulation, the Commission designates the units of the Funds as "foreign securities" for the purposes of the definition of "foreign securities" in subsection 204(1) of the Regulation.
April 25, 2007