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Frigate Ventures LP - s. 218 of the Regulation
Headnote
Application to the Commission for an order, pursuant to section 218 of Regulation 1015 of the Securities Act (Ontario), that the requirement in section 213 of the Regulation, which provides that a registered dealer that is not an individual must be a company incorporated, or a person formed or created, under the laws of Canada or a province or territory of Canada, shall not apply to the Applicant. Although the Applicant is not registered as a dealer in its home jurisdiction, it is registered as an adviser both in its home jurisdiction as well as in Ontario. The order imposes only those terms and conditions typically applicable to a non-resident limited market dealer that are not also imposed by virtue of the Applicant's registration as an adviser registered in Ontario.
Applicable Statutes
Ontario Regulation 1015, R.R.O. 1990, ss. 213, 218.
IN THE MATTER OF
THE SECURITIES ACT, R.S.O. 1990,
CHAPTER S.5, AS AMENDED (the Act)
AND
IN THE MATTER OF
R.R.O. 1990, REGULATION 1015,
AS AMENDED (the Regulation)
AND
IN THE MATTER OF
FRIGATE VENTURES LP
ORDER
(Section 218 of the Regulation)
UPON the application (the Application) of Frigate Ventures LP (the Applicant) to the Ontario Securities Commission (the Commission) for an order, pursuant to section 218 of the Regulation, exempting the Applicant from the requirement in section 213 of the Regulation that the Applicant be incorporated, or otherwise formed or created, under the laws of Canada or a province or territory of Canada, for the Applicant to be registered under the Act as a dealer in the category of limited market dealer;
AND UPON considering the Application and the recommendation of staff of the Commission;
AND UPON the Applicant having represented to the Commission that:
1. The Applicant is a limited partnership formed under the laws of the State of Texas in the United States. The head office of the Applicant is located in Dallas, Texas.
2. The Applicant is registered as an investment adviser with the State Securities Board of Texas in the United States.
3. The Applicant will be registered as an adviser in the category of investment counsel and portfolio manager under the Act.
4. The Applicant has applied to the Commission for registration under the Act as a dealer in the category of limited market dealer.
5. The Applicant proposes, as a limited market dealer, to primarily offer privately placed securities to accredited investors in Ontario pursuant to the registration and the prospectus exemptions contained in National Instrument 45-106 Prospectus and Registration Exemptions.
6. Section 213 of the Regulation provides that a registered dealer that is not an individual must be a company incorporated, or a person formed or created, under the laws of Canada or a province or territory of Canada.
7. The Applicant is not resident in Canada and does not require a separate Canadian company to carry out its proposed limited market dealer activities in Ontario. It is more efficient and cost-effective to carry out those activities through the existing company.
8. Without the relief requested the Applicant would not meet the requirements of the Regulation for registration as a dealer in the category of limited market dealer as it is not a company incorporated, or a person formed or created, under the laws of Canada or a province or territory of Canada.
AND UPON being satisfied that to make this order would not be prejudicial to the public interest;
IT IS ORDERED THAT, pursuant to section 218 of the Regulation, and in connection with the registration of the Applicant as a dealer under the Act in the category of limited market dealer, section 213 of the Regulation shall not apply to the Applicant for a period of three years, provided that:
1. The Applicant maintains its registration under the Act as an adviser in the categories of investment counsel and portfolio manager.
2. The Applicant shall provide to each client resident in Ontario a statement in writing disclosing the non-resident status of the Applicant, the Applicant's jurisdiction of residence, the name and address of the agent for service of process of the Applicant in Ontario, and the nature of risks to clients that legal rights may not be enforceable.
3. The Applicant will inform the Director immediately upon the Applicant becoming aware:
(a) of its registration in any jurisdiction not being renewed or being suspended or revoked; or
(b) that it is the subject of an investigation or disciplinary action by any financial services or securities regulatory authority or self-regulatory authority; or
(c) that the registration of its salespersons or general partners who are registered in Ontario have not been renewed or have been suspended or revoked in any Canadian or foreign jurisdiction; or
(d) that any of its salespersons or general partners who are registered in Ontario are the subject of an investigation or disciplinary action by any financial services or securities regulatory authority or self-regulatory authority in any Canadian or foreign jurisdiction.
4. The Applicant will not have custody of, or maintain customer accounts in relation to securities, funds, and other assets of clients resident in Ontario.
March 26, 2007
"Wendell S. Wigle"
"Suresh Thakrar"