Canadian Imperial Bank of Commerce and CIBC Asset Management Inc. - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- Exemption from the reporting requirements of clause 117(1)(c) of the Securities Act (Ontario) provided that certain disclosure is made in the management reports of fund performance for each mutual fund and that certain records of portfolio transactions are kept.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 117(1)(c), 117(2).

Rules Cited

National Instrument 81-106 Investment Fund Continuous Disclosure.

April 28, 2006

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

ONTARIO, NOVA SCOTIA, NEW BRUNSWICK,

NEWFOUNDLAND AND LABRADOR

(the Jurisdictions)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

CANADIAN IMPERIAL BANK OF COMMERCE (CIBC)

AND CIBC ASSET MANAGEMENT INC. (CIBC AMI)

(the Filers)

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filers for a decision under the securities legislation of the Jurisdictions (the Legislation) that the provisions of the Legislation requiring a management company, or in British Columbia and New Brunswick a mutual fund manager, to file a report, within thirty days after each month end and in respect of each mutual fund to which it provides services, relating to every purchase or sale effected by such mutual fund through any related person or company with respect to which the related person or company received a fee either from the mutual fund or from the other party to the transaction or both (the Reporting Requirement) shall not apply to purchases and sales effected by the Funds through CIBC World Markets Inc. (CWMI), CIBC World Markets Corp. (CWMC), CIBC or any other Related Company (the Requested Relief).

Under the Mutual Reliance Review System for Exemptive Relief Applications

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) this MRRS decision document evidences the decision of each Decision Maker.

Interpretation

Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this decision.

"CIBC Group of Companies" means the Filers and their affiliates.

"Funds" means the mutual funds set out in Schedule A hereto, together with such other funds managed by a member of the CIBC Group of Companies from time to time.

"Portfolio Advisers" means the portfolio advisers or sub-advisers of the Funds appointed by the Filers.

"Related Company" means CWMI, CWMC, or other related brokers or dealers that are members of the CIBC Group of Companies.

"NI 81-106" means National Instrument 81-106 Investment Fund Continuous Disclosure.

Representations

This Decision is based on the following facts represented by the Filer:

1. CIBC is a bank listed in Schedule I to the Bank Act (Canada), S.C. 1991, c. 46, as amended, with its head office currently in Toronto, Ontario. CIBC AMI is a corporation established under the laws of Canada with its head office currently in Toronto, Ontario. CIBC AMI is registered under the Securities Act (Ontario), R.S.O. 1990 c. S.5, as amended, as a mutual fund dealer and an adviser in the categories of investment counsel and portfolio manager, and under the Commodity Futures Act (Ontario), R.S.O. 1990, c. C.20, as amended, in the category of commodity trading manager.

2. The Filers act as managers of the mutual funds that currently consist of the funds set out in Schedule A hereto.

3. CWMI is a registered dealer in each of the provinces of Canada. CWMC is registered as an international dealer with the Ontario Securities Commission.

4. The Funds are open-ended investment trusts or mutual fund trusts established under the laws of the Province of Ontario. Each Fund is a reporting issuer in each of the provinces and territories of Canada.

5. Each of CIBC AMI, CWMI and CWMC are subsidiaries of CIBC. CWMI and CWMC are issuers in which CIBC (which is also a substantial securityholder of CIBC AMI) has a significant interest, such that the Funds are prohibited from making an investment in CWMI and CWMC under the Legislation. Therefore, CWMI and CWMC are "related persons" to the Funds under the Legislation.

6. As disclosed in the annual information forms or prospectuses of the Funds, the Portfolio Advisers may allocate brokerage business of the Funds to a Related Company, provided such transactions are made on terms and conditions comparable to those offered by unrelated brokers and dealers.

7. The Portfolio Advisers of the Funds have discretion to allocate brokerage business in any manner that they believe to be in a Fund's best interests. The purchase or sale of securities effected through a Related Company represents the business judgment of responsible persons uninfluenced by considerations other than the best interests of the Funds. In allocating brokerage, consideration is given to commission rates and to research, execution and other services offered.

8. The Funds will disclose in their interim and annual financial statements and in their interim and annual management reports of fund performance the amount of brokerage commissions paid by each Fund on trades with Related Companies.

9. In the absence of this Decision, reports must be filed on a monthly basis in respect of every purchase or sale of securities effected through a Related Company stating the issuer of the securities purchased or sold, the class or designation of the securities, the amount or number of securities, the consideration, the name of the Related Company receiving the fee, the name of the person or company that paid the fee to the Related Company and the amount of the fee received by the Related Company.

10. It would be costly and time consuming to provide the information required by the Legislation on a monthly and segregated basis.

11. Exemptive relief from the Reporting Requirement was previously granted to the Filers pursuant to a Mutual Reliance Review System Decision Document dated May 27, 2003. This relief was conditional on the Funds disclosing, in their statements of portfolio transactions, in respect of every class or designation of securities of an issuer bought or sold during the period to which the statement of portfolio transactions related, the name of each Related Company, the amount of fees paid to each Related Company, and the person or company that paid the fees.

12. Since the introduction of NI 81-106, mutual funds are no longer required to prepare a statement of portfolio transactions. Therefore, the Funds are no longer able to comply with the exemptive relief previously granted. However, NI 81-106 now requires the Funds to prepare and file annual and interim management reports of fund performance that include a discussion of transactions involving related parties to the Funds. When discussing portfolio transactions with related parties, NI 81-106 requires the Funds to include the dollar amount of commission, spread or any other fee paid to a related party in connection with a portfolio transaction.

Decision

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 under the Legislation is that the Requested Relief is granted provided that:

(a) the annual and interim management reports of fund performance for each Fund disclose

(i) the name of the Related Company,

(ii) the amount of fees paid to each Related Company, and

(iii) the person or company who paid the fees, if they were not paid by the Fund; and

(b) the records of portfolio transactions maintained by each Fund include, separately for every portfolio transaction effected by the Fund through a Related Company,

(i) the name of the Related Company,

(ii) the amount of fees paid to the Related Company, and

(iii) the person or company who paid the fees.

Schedule "A"

List of Funds

CANADIAN IMPERIAL BANK OF COMMERCE

CIBC ASSET MANAGEMENT INC.