Securities Law & Instruments

Headnote

Relief from the requirements otherwise applicable to the Filer as a reporting issuer who is not a venture issuer -- Filer is cross listed on the TSX Venture Exchange and the Bolsa de Comercio de Santiago, Venture marketplace of the Santiago Stock Exchange and the Risk Capital Segment of the Lima Stock Exchange (Segmento de Capital de Riesgo de la Bolsa de Valores de Lima) in Peru -- relief granted subject to conditions, including that the Filer complies with the requirements of Canadian securities legislation applicable to a venture issuer.

Applicable Legislative Provisions

National Instrument 41-101 General Prospectus Requirements, s. 19.1.

National Instrument 51-102 Continuous Disclosure Obligations, s. 13.1.

National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards, s. 5.1.

National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, s. 8.6.

National Instrument 52-110 Audit Committees, s. 8.1.

National Instrument 58-101 Disclosure of Corporate Governance Practices, s. 3.1.

Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions, s. 9.1.

August 11, 2015

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 PERUVIAN PRECIOUS METALS CORP. (the "Filer")

DECISION

Background

The securities regulatory authority in the Jurisdiction (the "principal regulator") has received an application from the Filer for a decision under the securities legislation of the Jurisdiction (the "Legislation") for:

(i) relief from the requirements otherwise applicable to the Filer as a reporting issuer who is not a venture issuer in each of the following instruments, including the forms thereof (collectively, the "Instruments"):

a. National Instrument 41-101 General Prospectus Requirements;

b. National Instrument 51-102 Continuous Disclosure Obligations;

c. National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards;

d. National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings;

e. National Instrument 52-110 Audit Committees; and

f. National Instrument 58-101 Disclosure of Corporate Governance Practices,

in connection with the listing of the Filer's common shares ("Shares") on the Lima Venture Exchange (the "Lima Disclosure Relief");

(ii) relief from the requirements otherwise applicable to the Filer as a reporting issuer who is not a venture issuer in each of the Instruments in connection with the listing of the Shares on the Santiago Venture Market (the "Santiago Disclosure Relief");

(iii) the formal valuation requirements under sections 4.3 and 5.4 of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101") (the "Valuation Relief"); and

(iv) the minority approval requirements under section 5.6 of MI 61-101 (the "Minority Approval Relief", and together with the Lima Disclosure Relief, the Santiago Disclosure Relief and the Valuation Relief, the "Exemption Sought").

Securities legislation imposes obligations for all reporting issuers. There are different obligations applicable to reporting issuers who are venture issuers and to those that are non-venture issuers. The Exemption Sought, if granted, would permit the Filer to comply with the obligations applicable to venture issuers notwithstanding that the Filer does not meet the criteria in the definition of "venture issuer".

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

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

(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 -- Passport System ("MI 11-102") is intended to be relied upon in British Columbia, Alberta, Saskatchewan and Manitoba with respect to the Lima Disclosure Relief; and

(c) the Filer has provided notice that section 4.7(1) of MI 11-102 is intended to be relied upon in Manitoba with respect to the Santiago Disclosure Relief.

Interpretation

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

"Lima Venture Exchange" means Risk Capital Segment of the Lima Stock Exchange (Segmento de Capital de Riesgo de la Bolsa de Valores de Lima) in Peru; and

"Santiago Venture Market" means the Bolsa de Comercio de Santiago Venture marketplace of the Santiago Stock Exchange in Chile.

Representations

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

1. The Filer is continued under the Business Corporations Act (British Columbia) and its registered and head office is in Vancouver, British Columbia.

2. The Filer is a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario (the "Reporting Jurisdictions").

3. The Filer's principal asset, the Igor project, is located in Peru.

4. The Shares trade on the TSX Venture Exchange ("TSXV") under the trading symbol "PPX".

5. In certain of the Instruments, the definition of "venture issuer" excludes, a reporting issuer, who at the applicable time, has any of its securities listed or quoted on any of the Toronto Stock Exchange, a U.S. marketplace, or a marketplace outside of Canada or the United States of America other than the Alternative Investment Market of the London Stock Exchange of the PLUS markets operating by PLUS Markets Group plc. (the "Venture Issuer Definition").

6. The Shares have also been listed on the Lima Venture Exchange since March 7, 2011. As the Lima Venture Exchange is a marketplace outside of Canada, the Filer did not meet the criteria in the Venture Issuer Definition and consequently has been in default of the securities legislation requirements in the Reporting Jurisdictions that apply to a non-venture issuer.

7. The Lima Venture Exchange is a junior market and is similar to the TSXV in terms of its requirements as the requirements of the Lima Venture Exchange were modeled after those of the TSXV, among other reputable venture exchanges.

8. The Lima Venture Exchange requires the Filer to comply with TSXV requirements in order to maintain its listing. The Lima Venture Exchange also requires that the Filer file with the Lima Venture Exchange copies of all public disclosure documents filed with Canadian securities regulators.

9. The Filer acknowledges that any right of action, remedy, penalty or sanction available to any person or company or to a securities regulatory authority against the Filer from March 7, 2011 until the date of this decision are not terminated or altered as a result of this decision.

10. The Filer wishes to list its Shares on the Santiago Venture Market due to the Filer's connection with South America and to facilitate the sale and transfer of Shares in Chile. As the Santiago Venture Market is a marketplace outside of Canada, the listing of the Filer's Shares on the Santiago Venture Market would also cause the Filer to not meet the criteria in the Venture Issuer Definition.

11. The Santiago Venture Market is a venture capital market for small and early stage companies in the mining sector.

12. A listing on the Santiago Venture Market is available only as a secondary listing to entities listed on the TSXV. Pursuant to the Santiago Venture Market listing requirements and pursuant to the agreement entered into between the Santiago Venture Market and the TSXV, securities which are listed on the Santiago Venture Market must also be listed on the TSXV and the filing obligations of the TSXV and the Santiago Venture Market are identical. Moreover, the Santiago Venture Market defers to the TSXV policy manual in respect of any filing obligations. There are no additional filing obligations with Chilean regulators and no additional ongoing filing obligations with the Santiago Venture Market arising from the listing on the Santiago Venture Market.

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 Lima Disclosure Relief, the Santiago Disclosure Relief and the Valuation Relief are granted provided that:

1. the Filer complies with the conditions and requirements of Canadian securities legislation applicable to a venture issuer;

2. the Lima Venture Exchange is not restructured in a manner that makes it unreasonable to conclude that it is still a junior market and the representations listed in paragraphs 7 and 8 above continue to be true;

3. the Santiago Venture Market is not restructured in a manner that makes it unreasonable to conclude that it is still a junior market and the representations listed in paragraphs 11 and 12 above continue to be true;

4. the Filer has Shares listed on the TSXV;

5. the Filer does not have any securities listed or quoted on any of the Toronto Stock Exchange, a U.S. marketplace or a marketplace outside of Canada and the United States of America other than the Lima Venture Exchange, Santiago Venture Market, the Alternative Investment Market of the London Stock Exchange or the PLUS markets operated by PLUS Markets Group plc;

6. in the event an exemption under Canadian securities legislation applies to a requirement in the Instruments applicable to the Filer, and a condition to the exemption requires the issuer to be a venture issuer, the Filer may invoke the benefit of that exemption if the Filer meets the conditions required by the exemption except for the condition that the Filer be a venture issuer;

7. in the event an exemption under Canadian securities legislation applies to a requirement applicable to the Filer as a reporting issuer who is not a venture issuer in the Instruments, and a condition to the exemption requires the issuer to not be a venture issuer, the Filer does not invoke the benefit of the exemption; and

8. the Minority Approval Relief is granted further provided that, in addition to conditions 1 through 7 above, the Filer would be exempt from the minority approval requirements in section 5.6 of MI 61-101, but for the fact that it does not meet the requirements of subparagraph 5.7(1)(b)(i) of MI 61-101.

"Kathryn Daniels"
Deputy Director, Corporate Finance
Ontario Securities Commission