Power Corporation of Canada and Power Financial Corporation - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications - Application by parent companies of subsidiaries that are reporting issuers for exemption from the requirement of the parent companies to file material contracts that are already filed by its subsidiaries -- exemption granted subject to certain conditions.

Instruments Cited

National Instrument 51-102 Continuous Disclosure Obligations -- s. 12.2(1)

November 19, 2004

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ALBERTA, MANITOBA, NEW BRUNSWICK,

NEWFOUNDLAND AND LABRADOR, NOVA SCOTIA,

ONTARIO, QUÉBEC AND SASKATCHEWAN

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

POWER CORPORATION OF CANADA

AND

POWER FINANCIAL CORPORATION

MRRS DECISION DOCUMENT

WHEREAS the local securities regulatory authority or regulator (the "Decision Maker") in each of Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Québec and Saskatchewan, (the "Jurisdictions") has received an application from Power Corporation of Canada ("PCC") and Power Financial Corporation ("PFC") (together, the "Filers") for a decision under the securities legislation of the Jurisdictions (the "Legislation") and in Québec by a revision of the general order that will provide the same result as an exemption order, that the Filers be exempt from the requirements under subsection 12.2(1) contained in National Instrument 51-102 - Continuous Disclosure Obligations ("NI 51-102") in regard to filing a copy of any contract material to the Filers that they or certain of the Filers' subsidiaries are parties to;

AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), l'Agence nationale d'encadrement du secteur financier (also known as "Autorité des marchés financiers") is the principal regulator for this application;

AND WHEREAS unless otherwise defined, the terms herein have the meaning set out in National Instrument 14-101 Definitions;

AND WHEREAS the Filers have represented to the Decision Makers that:

1. PCC was continued under the Canada Business Corporations Act (the "CBCA") on June 13, 1980 and is a reporting issuer in all of the provinces and territories of Canada where such concept exists;

2. The securities of PCC are listed on the Toronto Stock Exchange (the "TSX") under the trading symbol "POW";

3. PFC was continued under the CBCA on December 4, 1986 and is a reporting issuer in all of the provinces and territories of Canada where such concept exists;

4. The securities of PFC are listed on the TSX under the trading symbol "PWF";

5. The registered office of each of the Filers is located at 751 Victoria Square, Montréal, H2Y 2J3;

6. Neither of the Filers are in default of any of their respective obligations under the Legislation as a reporting issuer.

7. PCC is a publicly-traded holding company whose investments include:

• a 66.4% interest in PFC;

• 100% of the shares of Gesca Limitée, a Canadian publishing subsidiary of PCC;

• 100% of the shares of Power Technology Investment Corporation, a Canadian technology and biotechnology investment subsidiary of PCC; and

• cash, investments and other corporate assets;

8. PFC is a publicly-traded holding company whose investments include:

• a 70.4% interest in Great-West Lifeco Inc. ("GWL"), a Canadian company, reporting issuer in all of the provinces and territories of Canada where such concept exists, whose shares are listed on the TSX under the trading symbol "GWO";

• a 56.0% interest in IGM Financial Inc, formerly Investors Group Inc. ("IGM"), a Canadian company, reporting issuer in all of the provinces and territories of Canada where such concept exists, whose shares are listed on the TSX under the trading symbol "IGI";

• through its wholly owned subsidiary Power Financial Europe B.V., a Netherlands company, a 50.0% interest in Parjointco N.V. ("Parjointco"), a Netherlands company; and

• an effective 27.2% interest through Parjointco in Pargesa Holding S.A., a Swiss holding company which holds interests in a selected number of large European companies and whose shares are listed on the Swiss Exchange;

9. The interests of GWL include:

• 100% of the shares of The Great-West Life Assurance Company ("GWLA"), a Canadian company, reporting issuer in all of the provinces and territories of Canada where such concept exists, which also has certain classes and series of preferred shares listed on the TSX under the trading symbols "GWL.PR.L" and "GWL.PR.O" and

• 100% of the shares of Great-West Life & Annuity Insurance Company, a private company existing under the laws of Colorado;

10. The interests of GWLA include:

• an indirect 100% interest in London Reinsurance Group Inc., a private company existing under the CBCA;

• 100% of the shares of Canada Life Financial Corporation ("CLFC"), a Canadian reporting issuer in all of the provinces and territories of Canada where such concept exists, which also has non-cumulative preferred shares listed on the TSX under the trading symbol "CL.PR";

• an indirect 100% interest in The Canada Life Assurance Company, a company existing under the CBCA; and

• a 3.5% interest in IGM;

11. The investments of IGM include:

• 100% of the shares of Mackenzie Financial Corporation, a private company existing under the Business Corporations Act (Ontario); and

• a 4.2% interest in GWL;

12. Each of the Filers, GWL and IGM is a constituent company of the S&P/TSX Composite Index;

13. GWL and IGM each has its' registered office in Winnipeg, Manitoba;

14. GWL and IGM are separate business units from each other and from PFC and PCC;

15. The direct and indirect subsidiaries of the Filers relevant to this application are GWL and its subsidiaries, IGM and its subsidiaries and, in the case of PCC, PFC and its subsidiaries (collectively, the "Subsidiaries");

16. Under subsection 12.2(1) of the NI 51-102, each of the Filers is required to file a copy of any contract material to the Filers that they or any of their respective subsidiaries, including the Subsidiaries, are parties to;

17. Under subsection 12.2(1) of NI 51-102, GWL, GWLA, CLFC and IGM, all subsidiaries of the Filers and Canadian reporting issuers, are also required to file a copy of any contract material to GWL, GWLA, CLFC and IGM that they or any of their respective subsidiaries are parties to;

18. Under subsection 12.2(1) of NI 51-102, PFC, a subsidiary of PCC and a Canadian reporting issuer, is also required to file a copy of any contract material to PFC that it or any of its subsidiaries is a party to;

AND WHEREAS under the System, this MRRS Decision Document evidences the decision of each Decision Maker (collectively, the "Decision");

AND WHEREAS each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the Decision has been met;

THE DECISION of the Decision Makers pursuant to the Legislation is that:

(i) the Filers shall be exempt from the requirement under subsection 12.2(1) of NI 51-102 to file a copy of any contract material to the Filers that GWL or any of GWL's subsidiaries is a party to, provided that GWL is (a) a reporting issuer that is required to file contracts material to GWL that GWL or any of its subsidiaries is a party to; (b) listed on the TSX; and (c) a constituent company of the S&P/TSX Composite Index;

(ii) the Filers shall be exempt from the requirement under subsection 12.2(1) of NI 51-102 to file a copy of any contract material to the Filers that IGM or any of IGM's subsidiaries is a party to, provided that IGM is (a) a reporting issuer that is required to file contracts material to IGM that IGM or any of its subsidiaries is a party to; (b) listed on the TSX; and (c) a constituent company of the S&P/TSX Composite Index;

(iii) PCC shall be exempt from the requirement under subsection 12.2(1) of NI 51-102 to file a copy of any contract material to PCC that PFC or any of PFC's subsidiaries is a party to, provided that PFC is (a) a reporting issuer that is required to file contracts material to PFC that PFC or any of its subsidiaries (other than the Subsidiaries) is a party to; (b) listed on the TSX; and (c) a constituent company of the S&P/TSX Composite Index;

(iv) the exemptions provided in this Decision to PCC are subject to the further condition that PCC shall disclose in each of its Annual Information Forms that (a) PFC, GWL and IGM, the major direct and indirect subsidiaries of PCC, are reporting issuers under Canadian securities legislation; (b) PFC, GWL and IGM are subject to the same continuous disclosure obligations as is PCC and that these obligations include the requirement to file annual and interim financial statements, material change reports and copies of material contracts; and (c) investors who wish to do so may view such documents under the respective company profiles at www.sedar.com;

(v) the exemptions provided in this Decision to PFC are subject to the further condition that PFC shall disclose in each of its Annual Information Forms that (a) GWL and IGM, the major direct subsidiaries of PFC, are reporting issuers under Canadian securities legislation; (b) GWL and IGM are subject to the same continuous disclosure obligations as is PFC and that these obligations include the requirement to file annual and interim financial statements, material change reports and copies of material contracts; and (c) investors who wish to do so may view such documents under the respective company profiles at www.sedar.com.