Exemption from the requirement to deliver comparativeannual financial statements for the year ending December 31,2003 to registered securityholders of certain mutual funds.
Securities Act (Ontario), R.S.O. 1990 c. S.5,as am., ss. 79 and 80(b)(iii).
IN THE MATTER OF
THE SECURITIES LEGISLATIONOF
ALBERTA, ONTARIO, NOVA SCOTIA,
NEWFOUNDLAND AND LABRADOR
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEWSYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
IN THE MATTER OF
R MONEY MARKET FUND, R CORPORATETREASURY FUND, R BOND FUND, R NORTH AMERICAN HIGH YIELD BOND
FUND, R DIVIDEND FUND, R MONTHLYINCOME BALANCED FUND, R BALANCED FUND, R CANADIAN EQUITY FUND,
R CANADIAN LEADERS FUND, RLIFE & HEALTH FUND, R GLOBAL EQUITY FUND, R WORLD LEADERSFUND, R
AMERICAN FUND, R EUROPEANFUND, R SMALL CAP CANADIAN EQUITY FUND, R ASIAN FUND, R TECHNO-MEDIA
FUND, R LIFE & HEALTHRSP FUND, R WORLD LEADERS RSP FUND, R AMERICAN RSP FUND, R EUROPEANRSP
FUND, R ASIAN RSP FUND, RTECHNO-MEDIA RSP FUND, R PRUDENT DISTINCTION PORTFOLIO, R CONSERVATIVE
DISTINCTION PORTFOLIO, R BALANCEDDISTINCTION PORTFOLIO, R DYNAMIC DISTINCTION PORTFOLIO AND R
BOLD DISTINCTION PORTFOLIO(collectively, the "Existing Funds")
MRRS DECISION DOCUMENT
WHEREAS the Canadian securities regulatoryauthority or regulator (the "Decision Maker") in eachof the Provinces of Alberta, Ontario, Nova Scotia and Newfoundlandand Labrador (collectively, the "Jurisdictions") hasreceived an application (the "Application") from BLC-- Edmond de Rothschild Asset Management Inc. (the "Manager"),the Existing Funds and any other similar mutual funds createdby the Manager subsequent to the date hereof which is managedby same and offered by way of simplified prospectus (collectively,the "Future Funds" and, together with the ExistingFunds, the "Funds) for a decision pursuant to the securitieslegislation of the Jurisdictions (the "Legislation")for relief from the requirement to deliver comparative annualfinancial statements of the Funds to certain securityholdersof the Funds unless they have requested to receive them;
AND WHEREAS pursuant to 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;
AND WHEREAS it has been represented bythe Manager to the Decision Makers that:
1. The Existing Funds are open-ended mutualfund trusts established under the laws of Ontario.
2. The Manager, a majority-owned subsidiaryof Laurentian Bank of Canada, is a joint-venture created withLa Compagnie Financière Edmond de Rothschild Banquewith its head office located in Montréal, Québec.It is the trustee, the manager and the investment managerof each of the Existing Funds.
3. Each of the Existing Funds is a reportingissuer, or its equivalent, under the securities legislationof all the provinces of Canada, except Prince Edward Island,which provide for a reporting issuer regime and, to the bestof the Manager's knowledge, is not in default of any requirementsof such legislation relating thereto.
4. Units of the Existing Funds are currentlyoffered for sale in all of the provinces of Canada, exceptPrince Edward Island, pursuant to a simplified prospectusdated October 1, 2002 and November 20, 2002.
5. Each of the Existing Funds is requiredunder the Legislation to deliver annually, within 140 daysof its financial year-end, to each registered securityholdercomparative financial statements in the prescribed form.
6. The Manager proposes to send to securityholderswho hold securities of the Funds registered in their names(the "Direct Securityholders"), on an annual basis,either together with the relevant account statements or otherwise,a notice advising them that they will not receive the annualfinancial statements of the Fund(s) for the year ending December31, 2003 (the "Financial Statements"), unless theycomplete and return a request form accompanying the notice(the "Financial Statements Request"). The securityholderswill have the choice of returning the Financial StatementsRequest either by pre-paid mail or facsimile. The Direct Securityholderswill also be advised that the Financial Statements will bemade available on-line as well as free of charge by callinga toll-free number or by requesting them from their dealer.
7. Securityholders who hold their units inthe Funds through a nominee will be dealt with pursuant toNational Instrument 54-101 -- Communication with BeneficialOwners of Securities of a Reporting Issuer.
8. Securityholders will be able to accessthe Financial Statements either on the SEDAR website or on-lineat the Manager's website.
9. There would be substantial cost savingsif the Funds are not required to print and mail the FinancialStatements to those Direct Securityholders who do not wantthem.
10. The Canadian Securities Administratorshave published for comments proposed National Instrument 81-106-- Investment Fund Continuous Disclosure which, amongother things, would permit mutual funds not to deliver annualfinancial statements to those of its securityholders who donot request them, if the funds provide each securityholderwith a request form under which the securityholder may request,at no cost to the securityholder, to receive the mutual fund'sannual financial statements for that financial year.
11. Proposed National Instrument 81-106 wouldalso require a mutual fund to have a toll-free telephone numberfor, or accept collect calls from, persons or companies thatwant to receive a copy of, among other things, the annualfinancial statements of the mutual fund.
AND WHEREAS pursuant to the System, thisMRRS Decision Document evidences the decision of each DecisionMaker (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 pursuantto the Legislation is that the Funds shall not be required todeliver their Financial Statements to their Direct Securityholders,other than those who have requested to receive them, providedthat:
(a) the Manager shall file on SEDAR, underthe annual financial statements category, confirmation ofmailing of the request forms that have been sent to applicableDirect Securityholders. as described in paragraph 8 of theabove representations, within 90 days of mailing the requestforms;
(b) the Manager shall file on SEDAR, underthe annual financial statements category, information regardingthe number and percentage of requests for annual financialstatements made by the return of the request forms, on a province-by-provincebasis within 30 days after the end of each quarterly periodbeginning from the date of mailing the request forms and ending12 months from the date of mailing;
(c) the Manager shall record the number anda summary of complaints received from Direct Securityholdersabout not receiving the annual financial statements and shallfile on SEDAR, under the annual financial statements category,this information within 30 days after the end of each quarterlyperiod beginning from the date of mailing the request formsand ending 12 months from the date of mailing;
(d) the Manager shall, if possible, measurethe number of "hits" on the annual financial statementsof the Funds on the Manager's website and shall file on SEDAR,under the annual financial statements category, this informationwithin 30 days after the end of each quarterly period beginningfrom the date of mailing the request forms and ending 12 monthsfrom the date of mailing; and
(e) the Manager shall file on SEDAR, underthe annual financial statements category, estimates of thecost savings resulting from the granting of this Decisionwithin 90 days of mailing the request forms.
September 10, 2003.
"Wendell S. Wigle"
"H. Lorne Morphy"