Dundee Securities Corporation and Dundee Securities Ltd.

Decision

Headnote:

Multilateral Instrument 11-102 Passport System -- National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- National Instrument 33-109 Registration Information (NI 33-109) -- relief from certain filing requirements of NI 33-109 in connection with a bulk transfer of business locations and registered and non-registered individuals under an asset acquisition in accordance with section 3.4 of Companion Policy 33-109CP to NI 33-109.

Applicable Legislative Provisions

Multilateral Instrument 11-102 Passport System.

National Instrument 33-109 Registration Information and Companion Policy 33-109CP.

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions.

January 26, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

DUNDEE SECURITIES CORPORATION (DSC)

AND DUNDEE SECURITIES LTD. (DSL)

(the Filers)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filers for a decision of the principal regulator under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for relief pursuant to section 7.1 of National Instrument 33-109 Registration Information (NI 33-109) to allow the bulk transfer of the specified business locations and registered individuals of DSC to DSL (the Bulk Transfer), on or about January 28, 2011, in accordance with section 3.4 of the companion policy to NI 33-109, from the following requirements (the Exemption Sought):

1. to submit a notice regarding the termination of each employee, partner, or agent under section 4.2 of NI 33-109;

2. to submit a registration application or a reinstatement notice for each individual seeking to be a registered individual under section 2.2 or 2.3 of NI 33-109;

3. to submit a Form 33-109F4 or Form 33-109F7 for each permitted individual under section 2.5 of NI 33-109; and

4. to notify the regulator of a change to the business location information in Form 33-109F3 under section 3.2 of NI 33-109.

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(i) the Ontario Securities Commission is the principal regulator for this application; and

(ii) the Filers have provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon by each of the Filers on the same basis in each of the other provinces and territories of Canada (collectively with Ontario, the Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filers:

(a) DSC

1. DSC is a corporation incorporated under the Business Corporations Act (Ontario) and has its head office at 1 Adelaide Street East, Suite 2700, Toronto, Ontario M5C 2V9.

2. DSC is currently registered as an investment dealer in all of the Jurisdictions, as an investment fund manager in Ontario and as a derivatives dealer in Québec.

3. DSC is a member of the Investment Industry Regulatory Organization of Canada (IIROC).

4. DSC is not in default of the securities legislation in any of the Jurisdictions.

(b) DSL

5. DSL is a corporation incorporated under the Business Corporations Act (Ontario) and has its head office at 1 Adelaide Street East, Suite 2000, Toronto, Ontario M5C 2V9.

6. DSL has applied to become registered as an investment dealer in all of the Jurisdictions, as an investment fund manager in Ontario and as a derivatives dealer in Québec.

7. DSL has also applied to become a member of IIROC.

(c) The Transaction

8. The Bank of Nova Scotia has offered to purchase (the Scotiabank Offer), subject to certain terms and conditions, all of the shares of DundeeWealth Inc. (DundeeWealth) that it does not already own (the Transaction).

9. In connection with the Scotiabank Offer, and subject to the successful completion of the Transaction, DundeeWealth will spinout (the Spinout Transaction) its capital market business presently conducted through DSC and operating under the "Dundee Capital Markets" brand, and certain other assets (collectively, the Capital Markets Business), by way of distribution to all of the current shareholders of DundeeWealth, shares of Dundee Capital Markets Inc. (DCM). The DCM shares are intended to be issued by way of a dividend in kind to be declared on the business day immediately prior to the effective date of the Scotiabank Offer pursuant to an exemption from the prospectus requirements set forth in applicable securities legislation.

10. In connection with the Spinout Transaction, DCM intends to file a long form prospectus with one or more securities regulatory authorities in Canada in order to enable DCM to become a reporting issuer in one or more of the provinces or territories of Canada.

11. Immediately prior to the Spinout Transaction, DCM will acquire all of the issued and outstanding shares of DSL, which intends to carry on the business currently carried on by DSC (namely, the Capital Markets Business), other than the independent retail advisory business and back office operations, which will remain in DSC as part of DundeeWealth's business.

12. The following summarizes the Capital Markets Business. DSL's principal activities as a dealer will include institutional equity sales and trading, investment banking, research, and the retail corporate advisory business currently carried on by DSC. DSL will also as a dealer carry on fixed income, foreign exchange trading, principal and other trading activities. As an investment fund manager, DSL will become the manager of the CMP Gold Trust (a closed end fund) and the CMP and Canada Dominion Resources Limited Partnerships, including new closed-end or other funds that may be established in the future.

13. The closing of the Transaction is currently scheduled to occur on or about February 1, 2011.

14. All of the current registerable activities of DSC in respect of the Capital Markets Business will become the responsibility of DSL once DSL is registered as an investment dealer, investment fund manager and derivatives dealer, which is expected to occur on or about January 28, 2011 (the Bulk Transfer Date). On this date, DSL will assume all of the existing registrations and approvals for all of the registered individuals and all of the locations of DSC in respect of the Capital Markets Business.

15. It is not anticipated that there will be any disruption in the ability of the Filers to trade or advise on behalf of their respective clients either immediately before or immediately after the Bulk Transfer Date.

16. DSL will be registered in the same categories of registration as DSC is currently registered in the same Jurisdictions, and will be subject to, and will comply with, all applicable securities laws.

17. DSL will carry on the Capital Markets Business of DSC in substantially the same manner with essentially the same personnel as DSC carried on such business immediately prior to the Bulk Transfer Date.

18. It would be difficult to individually transfer each of the affected locations and individuals from DSC to DSL per the requirements set out in NI 33-109 given the multiple jurisdictions in which the individuals are currently registered or approved. Moreover, it is imperative that the transfer of the locations and individuals occur on the same date, in order to ensure that there is no break in registration. Clients of DSC whose accounts will be transferred to DSL will be advised in writing by DSC of the transfer prior to the Bulk Transfer Date in accordance with section 14.11 of National Instrument 31-103 Registration Requirements and Exemptions.

19. The Exemption Sought will not be contrary to the public interest and will have no negative consequences on the ability of the Filers to comply with all applicable regulatory requirements or the ability to satisfy any obligations to clients of the Filers.

20. The head office of DSL following the Transaction will continue to be located at 1 Adelaide Street East, Suite 2000, Toronto, Ontario M5C 2V9.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that the Filers make acceptable arrangements with CDS Inc. for the payment of the costs associated with the Bulk Transfer, and make such payment in advance of the Bulk Transfer.

"Erez Blumberger"
Deputy Director
Compliance and Registrant Regulation
Ontario Securities Commission