General
Ruling/Order 11-908 Designation Order Pursuant to Clause 2(1)(ww),
Subsection 45(3) and Clause 138.1(2)(b)
On July 6,
2007 the Commission issued General Ruling/Order 11-908
Designation Order Pursuant to Clause 2(1)(ww), Subsection 45(3)
and Clause 138.1(2)(b)
(“GRO 11-908”).
Clause 2(1)(ww)
The definition of “underwriter” in clause 2(1)(ww) of The
Securities Act, 1988 (the “Act”) was amended effective July 1,
2007 to exclude:
(a)
pursuant to subclause 2(1)(ww)(vi), a bank listed in
Schedule I, II or III of the Bank Act (Canada) with respect
to trades in securities designated by the Commission;
(b)
pursuant to subclause 2(1)(ww)(vii), a credit union or
Credit Union Central of Saskatchewan with respect to trades in
securities designated by the Commission; or
(c)
pursuant to subclause 2(1)(ww)(viii), an association
governed by the Co-operative Credit Association Act
(Canada) or a central co-operative credit society for which an
order has been made pursuant to subsection 473(1) of that Act,
with respect to trades in securities designated by the Commission;
Before the
amendment the provisions in clause 2(1)(ww) referred to trades in
securities described in clause 39(2)(a) of the Act. Clause
39(2)(a) provided an exemption from the registration requirement
in section 27 of the Act. The registration exemptions in section
39 of the Act have been repealed from the Act, and replaced with
the registration exemptions in National Instrument 45-106
Prospectus and Registration Exemptions (“NI 45-106”). The
exemption in section 2.34 of NI 45-106 is equivalent to the
exemption in clause 39(2)(a).
GRO 11-908
designates trades pursuant the exemption in section 2.34 for the
purposes of subclauses 2(1)(ww)(vi), (vii) and (viii).
Subsection
45(3)
Subsection 45(1) of the Act imposes disclosure requirements on a
registered dealer when it acts as principal on a trade.
Subsection 45(3) of the Act was amended effective July 1, 2007 to
provide that subsection 45(1) does not apply to securities or
trades that are exempt from the registration requirement in
section 27 pursuant to an exemption designated by the Commission.
Before the amendment, subsection 45(3) referred to exemptions in
the Act from the registration requirement in section 27. These
registration exemptions have been repealed from the Act and
replaced with the registration exemptions in NI 45-106.
GRO 11-908 designates trades pursuant to all of the registration
exemptions in NI 45-106 for the purposes of subsection 45(3).
Clause 138.1(2)(b)
Subsection 138.1(3) provides a right of action for damages for a
misrepresentation in advertising or sales literature for the
trades specified in subsection 138(2). Clause 138.1(2)(b) of the
Act was amended effective July 1, 2007 to provide that the right
of in subsection 138.1(3) applies trades of securities pursuant to
an exemption from the prospectus requirement in section 58
designated by the Commission.
Before the amendment, clause 138.1(2)(b) referred to exemptions in
the Act from the prospectus requirement in section 58. These
prospectus exemptions have been repealed from the Act and replaced
with the prospectus exemptions in NI 45-106.
GRO 11-908 designates trades pursuant to all of the prospectus
exemptions in NI 45-106 for the purposes of clause 138.1(2)(b).
Dated July 11, 2007
Contact:
Director, Securities Division
(306) 787-5842
