Securities Law & Instruments


Mutual Reliance Review System for Exemptive Relief Applications -- relief from the requirement to provide a statement of policies and obtain specific and informed written consent from discretionary management clients once in each twelve-month period with respect to purchases or sales of securities of certain related issuers -- subject to conditions.

Applicable Ontario Legislation

Ontario Regulation 1015, R.R.O. 1990, ss. 227(2)(b), 233.

June 20, 2007





(the Jurisdictions)











The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) that the restriction against a registrant acting as a portfolio manager and exercising discretionary authority with respect to a client's account in purchasing and/or selling the securities of a related issuer or a connected issuer of the registrant without providing the client with the statement of policies of the registrant and securing the specific and informed written consent of the client once in each twelve month period (the Annual Consent Requirement) does not apply in the case of the Filer acting as a portfolio manager on behalf of its Clients (as defined below) where securities of The Bank of Nova Scotia (the Bank) are purchased or sold in a Fund (as defined below) for an account of a Client which has granted the Filer discretionary authority, subject to certain conditions.

Under the Mutual Reliance Review System for Exemptive Relief Applications:

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) this MRRS decision document evidences the decision of each Decision Maker.


Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this decision.


This decision is based on the following facts represented by the Filer:

1. The Filer is a corporation incorporated under the laws of Ontario.

2. The Filer carries on certain investment management activities on a discretionary basis. The Filer is registered as an advisor in all provinces of Canada other than Quebec and as a limited market dealer in Ontario and Newfoundland and Labrador. The Filer is also registered as a commodity trading manager in Ontario.

3. The Filer manages, on a fully discretionary basis, assets of those clients (collectively, the Clients) who enter into an investment management agreement with the Filer (the Managed Account Agreement). The Filer is the investment manager for both institutional Clients (ICMC Clients), and high net worth Clients of Integra Capital Financial Corporation (ICFC Clients).

4. Integra Capital Management Corporation (ICMC) has established, and may establish in the future, proprietary pooled funds (the ICMC Pooled Funds) and mutual funds offered by prospectus (the ICMC Mutual Funds), for which either the Filer or its affiliate is or will be the manager.

5. ICFC has established, and may establish in the future, proprietary pooled funds (the ICFC Pooled Funds), for which Integra Capital Financial Corporation (ICFC) is the manager.

6. The Filer has authority to carry out its investment management mandate for a Client by placing them in pooled funds, including the ICMC Pooled Funds, the ICMC Mutual Funds and the ICFC Pooled Funds (collectively, the Funds). With the exception of only a couple of accounts of ICFC Clients which invest solely on a segregated account basis, all other ICFC Clients are invested in the Funds.

7. Where the Filer is the manager of the Fund, the Manager will retain a third party sub-advisor (the External Advisor). Where the Filer is not the manager of the Fund, the manager may retain the Filer as the investment manager and the Filer will in turn retain the External Advisor. External Advisors are also appointed in respect of the segregated portfolios.

8. The External Advisors do not have any direct contact with Clients. Each External Advisor manages the portfolio of a Fund or a segregated account independently of the Filer and its affiliates and in accordance with the Fund's or the Client's investment objectives.

9. ICFC recently became an affiliate of the Bank pursuant to a share purchase transaction with principals and shareholders of the Integra group of which the Filer is a part (the Transaction).

10. Pursuant to the terms of the Transaction, the Filer has agreed to continue as the advisor to the ICFC Clients until ICFC or any existing or newly created affiliate of ICFC seeks registration as an advisor during the 6 month period following closing of the Transaction. When ICFC or its affiliate obtains its advisor registrations, the Filer has agreed to assign the Managed Account Agreement with each ICFC Client to ICFC or as it may direct, after providing the notice to the ICFC Client required by applicable securities legislation, regulation or rules. The Filer and its affiliate have also agreed to provide certain other transition services for a term of a year or more.

11. Each of the ICMC Mutual Funds and ICMC Pooled Funds are or will be either a related issuer of the Filer or a connected issuer, in the course of a distribution, of the Filer, depending on the facts and the terminology of the securities legislation, regulations or rules of the Principal Regulator and Other Regulators. Each of the ICFC Pooled Funds is or will be similarly a related or connected issuer of the Filer due to the fact that the Filer continues as the advisor to the ICFC Clients and the Filer has agreed with ICFC to continue to make use of the ICFC Pooled Funds for the ICFC Clients until it ceases to be the advisor pursuant to the terms of the Transaction. It should be noted that ICFC Clients are invested in both ICFC Pooled Funds and ICMC Pooled Funds and/or ICMC Mutual Funds.

12. On August 4, 2004, the Filer was granted exemptive relief from having to obtain an annual consent from the ICMC Clients and the ICFC Clients in order to invest such Clients in the Funds (the Relief Order), on the basis of the terms and conditions therein set out.

13. Certain of the Funds and a segregated portfolios were already invested in securities of the Bank at the time of the Transaction. Such investments were made by External Advisors with no knowledge of the pending Transaction.

14. The Filer does not want to restrict the External Advisors from purchasing or selling securities of the Bank in the future for Clients of the Filer either directly in a segregated account or through the Funds. This would cause the Clients to lose the benefit of the External Advisor's independent advice with respect to the portfolios of the Clients or the Funds.

15. The Filer intends to obtain the specific and informed written consent of each existing ICMC Client and each existing ICFC Client to the continued holding of, and additional purchases or sales of, securities of the Bank in lieu of seeking their annual consent. All new Clients will be asked to provide their consent in the Managed Account Agreement.

16. All existing Clients will receive an amended statement of policies of the Filer. All new discretionary Clients of the Filer will receive the same statement of policies. In the event of any significant change in its statement of policies, the Filer will provide to each Client a copy of its further amended statement of policies.

17. The Legislation of each Jurisdiction prohibits a registrant from acting as an advisor of securities of the registrant, or of a related issuer of the registrant or in the course of a distribution, in respect of securities of a connected issuer of the registrant (the Related/Connected Issuer Prohibition).

18. The Annual Consent Requirement, to the extent applicable, exempts a registrant from the Related/Connected Issuer Prohibition.


Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Makers with the jurisdiction to make the decision has been met.

The decision of the Decision Makers pursuant to the Legislation is that the Filer is exempt from the Annual Consent Requirement provided that:

(a) the Filer has secured the specific and informed written consent of the Client in advance of the exercise of discretionary authority in respect of securities of the Bank;

(b) the Filer has previously provided the Client with a statement of policies, or equivalent document, of the Filer which identifies the relationship between the Filer and the Bank; and

(c) the Filer does not participate in, or influence, the investment recommendations of an External Adviser in making its recommendation.

"Robert L Shirriff"
Ontario Securities Commission
"Suresh Thakrar"
Ontario Securities Commission