Cumberland Associates Investment Counsel Inc. et al.

Headnote

Under paragraph 4.1(1)(b) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations a registered firm must not permit an individual to act as a dealing, advising or associate advising representative of the registered firm if the individual is registered as a dealing, advising or associate advising representative of another registered firm. The Filers are affiliated entities and have valid business reasons for the individuals to be registered with both firms. The Filers have policies in place to handle potential conflicts of interest. The Filers are exempted from the prohibition for current and future representatives.

Applicable Legislative Provisions

Multilateral Instrument 11-102 Passport System, s. 4.7.

National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 4.1, 15.1.

June 14, 2012

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

CUMBERLAND ASSOCIATES

INVESTMENT COUNSEL INC.

(CAIC)

AND

CUMBERLAND PRIVATE WEALTH

MANAGEMENT INC.

(CPWM)

AND

SUKYONG YANG, PETER JACKSON

AND SCOTT LUIK

(collectively, the Filers)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filers for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for relief (the Requested Relief) from the requirement under paragraph 4.1(1)(b) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) to permit each of Ms. Sukyong Yang, Mr. Peter Jackson, and Mr. Scott Luik, and future individuals who are dealing representatives of CPWM to also be advising or associate advising representatives of CAIC (the Dual Registration).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

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

(ii) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon by the Filers in British Columbia, Ontario, Quebec and Alberta (collectively with Ontario, the Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning in this decision unless otherwise defined.

Representations

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

1. CPWM is registered under NI 31-103 as an investment fund manager in Ontario, as a derivatives dealer in Quebec and as a dealer in the category of investment dealer in each Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, Quebec and Saskatchewan. CPWM is a member of Investment Industry Regulatory Organization of Canada (IIROC). The head office of CPWM is located in Ontario.

2. CAIC is registered under NI 31-103 as an adviser in the category of portfolio manager in British Columbia, Ontario, Quebec and Alberta. The head office of CAIC is located in Ontario. CAIC is also registered with the Securities Exchange Commission to carry on business as an adviser to U.S. resident clients under section 203 of the United States Investment Advisers Act of 1940.

3. Each of the Filers is a direct wholly-owned subsidiary of Cumberland Partners Ltd. (CPL).

4. Neither of the Filers is in default of any requirements of securities legislation in any jurisdiction of Canada.

5. Both CPWM and CAIC service predominantly high net worth individuals.

6. Although CPWM is registered as an investment dealer, its business primarily consists of providing discretionary investment management services. CPWM does not engage in corporate finance or underwriting activities. CPWM offers a variety of model portfolios to its clients. These model portfolios are also offered to clients of CAIC.

7. Currently there are a number of individuals registered as dealing representatives with CPWM who are also registered as advising representatives with CAIC. This dual registration permits portfolio managers to order the trades for all the managed accounts following a model, and allocate the trades at an average price, regardless of whether the account holder is a client of CPWM or CAIC. Thus, helping to ensure that clients of one registrant don't receive more favourable pricing than clients of the other registrant.

8. This dual registration permits a dealing representative of CPWM who is also an advising or associate advising representative of CAIC to act as an adviser in respect of securities to all CAIC clients including non-resident CAIC clients.

9. The individuals will have the appropriate proficiency requirements for both the category of dealing representative of CPWM and for an advising or associate advising representative of CAIC.

10. The individuals will have sufficient time to adequately meet their obligations under each firm.

11. The Filers are each wholly-owned subsidiaries of CPL and accordingly, the Dual Registration will not give rise to the conflicts of interest present in a similar arrangement involving unrelated, arm's length firms. The interests of CPWM and CAIC are aligned and therefore, the potential for conflicts of interest is remote.

12. The Filers have in place policies and procedures to address conflicts of interest that may arise as a result of the Dual Registration, and believe that they will be able to appropriately deal with these conflicts.

13. The Dual Registration is disclosed to clients of CPWM and CAIC.

14. Relief from paragraph 4.1(1)(b) of NI 31-103 has been granted to the Filers pursuant to a decision dated December 1, 2011 permitting Gerald Connor to be dually registered as a dealing representative of CPWM and as an advising representative of CAIC.

15. In the absence of the Requested Relief, the Filers would be prohibited from permitting additional dealing representatives of CPWM to act as advising or associate advising representatives of CAIC while they are registered as a dealing representative of CPWM even though CAIC is an affiliate of CPWM.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Requested Relief is granted provided that with respect to any future individuals the circumstances described above in paragraphs 4, 8, 9, 10, 11, 12, and 13 remain in place.