Securities Law & Instruments

Headnote

Exemption for pooled funds from the requirementto file with the Commission interim financial statements undersection 77(2) of the Act and comparative financial statementsunder section 78(1) of the Act, subject to conditions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5 as am.,ss. 74(1).

Ontario Securities Commission Rule 45-501 --Exempt Distributions, s. 1.1.

National Instrument 13-101 -- System for ElectronicDocument Analysis and Retrieval (SEDAR), s. 2.1(1)1.

Regulations Cited

Regulation made under the Securities Act, R.R.O.Reg. 1015, as am.

IN THE MATTER OF

THE SECURITIES ACT (ONTARIO),R.S.O. 1990, CHAPTER S.5 AS AMENDED

(THE "ACT")

AND

IN THE MATTER OF

CAPITAL GUARDIAN TRUST COMPANY

AND

CAPITAL GUARDIAN INTERNATIONALFUND,

CAPITAL GUARDIAN INTERNATIONALEQUITY SECTION,

CAPITAL GUARDIAN U.S. EQUITYSECTION and

CAPITAL GUARDIAN EAFE EQUITYSECTION

(The "Existing PooledFunds")

 

ORDER

(Subsection 147 of the Act)

UPON the application (the "Application")of Capital Guardian Trust Company ("CGTC"), the managerof the Existing Pooled Funds and other pooled funds establishedand managed by CGTC from time to time (collectively, the "PooledFunds"), to the Ontario Securities Commission (the "Commission")for an order pursuant to subsection 147 of the Act exemptingthe Pooled Funds from filing with the Commission the interimand annual financial statements prescribed by sections 77(2)and 78(1), respectively, of the Act;

AND UPON considering the Applicationand the recommendation of the staff of the Commission;

AND UPON CGTC having represented to theCommission that:

1. CGTC is a corporation existing under thelaws of California with its head office in the United States.CGTC is, or will be, the manager of the Pooled Funds. CGTCis registered with the Commission as an international adviserin the categories of investment counsel and portfolio manager.

2. The Pooled Funds are, or will be, open-endmutual fund trusts established under the laws of Ontario.The Pooled Funds will not be reporting issuers in any provinceor territory of Canada. Units of the Pooled Funds are, orwill be, distributed in each of the provinces and territoriesof Canada without a prospectus pursuant to exemptions fromthe prospectus delivery requirements of applicable securitieslegislation.

3. The Pooled Funds represent an administrativelyefficient model that is designed to permit CGTC to build largerinvestment portfolios rather that reproduce those same portfoliosin individual segregated accounts.

4. The Pooled Funds fit within the definitionof "mutual fund in Ontario" in section 1(1) of theAct and are thus required to file with the Commission interimfinancial statements under section 77(2) of the Act and comparativeannual financial statements under section 78(1) of the Act(collectively, the "Financial Statements").

5. Unitholders of the Pooled Funds receivethe Financial Statements for the Pooled Funds they hold. TheFinancial Statements are prepared and delivered to unitholdersin the form and for the periods required under the Act andthe regulation or rules made thereunder (the "Regulation").

6. Section 2.1(1)1 of National Instrument13-101 - System for Electronic Document Analysis and Retrieval(SEDAR) ("Rule 13-101") requires that every issuerrequired to file a document under securities legislation makeits filing through SEDAR. The Financial Statements filed withthe Commission thus become publicly available.

AND UPON the Commission being satisfiedthat to do so would not be prejudicial to the public interest,

IT IS ORDERED by the Commission pursuantto subsection 147 of the Act that the Pooled Funds be exemptedfrom the requirements in sections 77(2) and 78(1) of the Actto file the Financial Statements with the Commission provided:

(a) The Pooled Funds will prepare and deliverto the unitholders of the Pooled Funds the Financial Statements,in the form and for the periods required under the Act andthe Regulation, as if the Financial Statements are requiredto be filed with the Commission;

(b) The Pooled Funds will retain the FinancialStatements indefinitely;

(c) The Pooled Funds will provide the FinancialStatements to the Commission or any member, employee or agentof the Commission immediately upon request of the Commissionor any member, employee or agent of the Commission;

(d) The Pooled Funds will provide a list ofthe Pooled Funds relying on this Order to the Investment FundsBranch of the Commission on an annual basis;

(e) Unitholders of the Pooled Funds will benotified that the Pooled Funds are exempted from the requirementsin sections 77(2) and 78(1) of the Act to file the FinancialStatements with the Commission; and

(f) In all other aspects, the Pooled Fundswill comply with the requirements in Ontario securities lawfor financial statements.

August 1, 2003.

"Harold P. Hands"
"Wendell S. Wigle"