Mutual Reliance Review System for ExemptiveRelief Applications - relief granted to certain vice presidentsof a reporting issuer from the insider reporting requirementssubject to certain conditions.
Securities Act, R.S.O. 1990, c. S.5, as am.,ss. 1(1), 107, 108, 121(2)(a)(ii).
Regulation made under the Securities Act, R.R.O.1990, Reg. 1015, as am., Part VIII.
National Instrument 55-101 - Exemption FromCertain Insider Reporting Requirements.
IN THE MATTER OF
THE SECURITIES LEGISLATIONOF
BRITISH COLUMBA, ALBERTA,SASKATCHEWAN, MANITOBA,
ONTARIO, QUEBEC, NEWFOUNDLANDAND LABRADOR,
AND NOVA SCOTIA
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEWSYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
IN THE MATTER OF
SUN LIFE FINANCIAL SERVICESOF CANADA INC.
SUN LIFE ASSURANCE COMPANYOF CANADA
MRRS DECISION DOCUMENT
WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") in eachof British Columbia, Alberta, Saskatchewan, Manitoba, Ontario,Québec, Newfoundland and Labrador, and Nova Scotia (collectivelythe "Jurisdictions") has received an application fromSun Life Financial Services of Canada Inc. ("SLF Inc.")and Sun Life Assurance Company of Canada ("SLACC"and, together with SLF Inc., "SLF" or the "SLFApplicants") for a decision pursuant to the securitieslegislation of the Jurisdictions (the "Legislation")that the requirement contained in the Legislation to file insiderreports shall not apply to certain individuals who are insidersof the SLF Applicants by reason of having the title of Vice-President;
AND WHEREAS under the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the Ontario Securities Commission is the principal regulatorfor this application;
AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Québec Commission Notice 14-101;
AND WHEREAS The SLF Applicants have representedto the Decision Makers that:
1. SLF Inc. is an insurance company governedby the Insurance Companies Act (Canada). SLACC is awholly-owned subsidiary of SLF Inc. and is an insurance companygoverned by the Insurance Companies Act (Canada).
2. SLF Inc. is a reporting issuer (or equivalent)in each province and territory of Canada. SLF Inc. is notin default of any requirements under the Legislation. SLACCis a reporting issuer (or equivalent) in each province andterritory of Canada. SLACC is not in default of any requirementsunder the Legislation.
3. All of the directors and officers of SLFInc. are also directors and officers of SLACC. Currently,304 individuals are insiders of the SLF Applicants by reasonof being a senior officer or director of the SLF Applicantsor a major subsidiary of the SLF Applicants and are not otherwiseexempt from the insider reporting requirements of the Legislationby reason of existing orders and/or the exemptions containedin National Instrument 55-101 Exemption from certain InsiderReporting Requirements ("NI 55-101").
4. The SLF Applicants have made this applicationto seek the requested relief in respect of approximately 210individuals, who, in the opinion of the SLF Law Department,satisfy the Exempt VP Criteria (as defined below).
5. SLF has trading restrictions in place forall directors and employees in the SLF group of companiesto ensure that such persons are aware that: 1) they are notpermitted to buy or sell securities of the SLF Applicantswhen they have material information about the SLF Applicantsthat has not been released to the general public; and 2) theyare not permitted to disclose, inadvertently or intentionally,material information about the SLF Applicants that has notbeen released to the general public, except to other employeeson a need-to-know basis.
6. SLF has additional trading restrictionsin place for senior officers as well as certain other employeeswho may receive or have access to non-public material informationabout the SLF Applicants. SLF developed these additional restrictionsto ensure that its directors, senior officers and other employeesare aware of their responsibilities under the Legislationand to assist them in complying with the Legislation.
7. The additional restrictions require thattrades in securities of the SLF Applicants may occur onlyduring certain time frames, generally for approximately 20business days after SLF's financial results are announced.These additional restrictions will continue to apply to anyindividual who is exempted from the insider reporting requirementsby the Decision Makers.
8. Designated staff in the SLF Law Departmentoversee administration of SLF's trading restrictions for seniorofficers and other employees.
9. Designated staff in the SLF Law Department,in consultation with the chief financial officers of eachof SLF's five principal business groups and certain officerswithin SLF's Corporate Office with a policy-making function,reviewed 1) the organizational structure of SLF and its majorsubsidiaries; 2) the function of each vice-president; and3) the distribution of non-public material information aboutSLF through each of its business groups and assessed whethernon-public material information about SLF was provided toa particular vice-president function in the ordinary coursebased on criteria contained in Canadian Securities AdministratorsStaff Notice 55-306 Applications for Relief from the InsiderReporting Requirements by Certain Vice-Presidents (the"Staff Notice").
10. The SLF Applicants have made this applicationto seek relief from the insider reporting requirement forindividuals who meet the following criteria set out in theStaff Notice (the "Exempt VP Criteria"):
(a) the individual is a vice-president;
(b) the individual is not in charge of aprincipal business unit, division or function of the SLFApplicants or a "major subsidiary" of the SLFApplicants (as that term is defined in NI 55-101);
(c) the individual does not in the ordinarycourse receive or have access to information regarding materialfacts or material changes concerning the SLF Applicantsbefore the material facts or material changes are generallydisclosed; and
(d) the individual is not an insider ofthe SLF Applicants in any capacity other than as a vicepresident;
11. The SLF Law Department applies the sameanalysis each time a new vice-president is appointed or anexisting vice-president is promoted. The SLF Law Departmentwill review and update SLF's Exempt VP analysis annually.
12. If an individual who is designated asan Exempt VP no longer satisfies the Exempt VP Criteria, designatedstaff of the SLF Law Department will ensure that the individualis informed about his or her renewed obligation to file aninsider report on trades in securities of the SLF Applicants.
13. In connection with this application, theSLF Applicants have filed with the Decision Makers a copyof their internal policies and procedures relating to monitoringand restricting the trading activities of their insiders andother persons whose trading activities are restricted by SLF.
AND WHEREAS under the System, this MRRSDecision Document evidences the decision of each Decision Maker(collectively, the "Decision");
AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;
THE DECISION of the Decision Makers underthe Legislation is that the requirement contained in the Legislationto file insider reports shall not apply to insiders of the SLFApplicants who satisfy the Exempt VP Criteria for so long assuch insiders satisfy the Exempt VP Criteria provided that:
(a) the SLF Applicants agree to make availableto the Decision Makers, upon request, to the extent permittedby law, a list of all individuals who are relying on the exemptiongranted by this Decision as at the time of the request; and
(b) the relief granted will cease to be effectiveon the date when NI 55-101 is amended.
July 29, 2003.
"Robert W. Korthals"
"H. Lorne Morphy"