Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions - Filer wants to put in place a credit support issuer structure, but is unable to rely on the exemption for credit support issuers in applicable securities legislation – Relief granted from continuous disclosure requirements, certification requirements, insider reporting requirement, audit committee requirements and corporate governance requirements – Relief also granted from short form prospectus requirements, incorporation by reference requirement, earnings coverage requirements and subsidiary credit supporter requirements – Filer unable to rely on exemption for credit support issuers in applicable securities legislation since Filer only owns 71% of an intermediate holding entity (a limited partnership) that indirectly owns 100% of the voting securities of each Issuer – When the characteristics of the limited partnership units of the holding limited partnership (including that the majority are held by the parent) are viewed together with a voting agreement, control and direction of the holding limited partnership is held by the Filer’s parent as if the parent beneficially owned all the outstanding voting securities of holding limited partnership – Filer unable to rely on the exemption since the issuer proposes to issue convertible preferred shares that are convertible into other preferred shares of the Issue – Relief subject to conditions, including conditions relating to minority interest in holding limited partnership.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, ss. 107 and 121(2)(a)(ii) National Instrument 44-101 Short Form Prospectus Distributions 8.1 National Instrument 51-102 Continuous Disclosure Obligations, ss. 13.1 and 13.4 National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, s. 8.6 National Instrument 52-110 Audit Committees, s. 8.1 National Instrument 55-102 System for Electronic Disclosure by Insiders (SEDI), s. 6.1 National Instrument 55-104 Insider Reporting Requirements and Exemptions, s. 10.1(2) National Instrument 58-101 Disclosure of Corporate Governance Practices, s. and 3.1
June 26, 2012
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 BROOKFIELD INFRASTRUCTURE PARTNERS L.P. (THE FILER)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) exempting:
(a) the Issuers (as defined below) from the requirements of National Instrument 51-102 — Continuous Disclosure Obligations (NI 51-102) (the Continuous Disclosure Requirements);
(b) the Issuers from the requirements of National Instrument 52-109 — Certification of Disclosure in Issuers’ Annual and Interim Filings (NI 52-109) (the Certification Requirements);
(c) insiders of the Issuers from the insider reporting requirement (as defined in National Instrument 14-101 — Definitions (NI 14-101)) (the Insider Reporting Requirements);
(d) the Issuers from the requirements of National Instrument 52-110 Audit Committees (NI 52-110) (the Audit Committee Requirements);
(e) the Issuers from the requirements of National Instrument 58-101 — Disclosure of Corporate Governance Practices (NI 58-101) (the Corporate Governance Requirements);
(f) the Issuers from the requirement in section 2.8 of National Instrument 44-101 — Short Form Prospectus Distributions (NI 44-101) to file a notice of intention to file a short form prospectus no fewer than 10 business days prior to a filing of a preliminary short form prospectus (the Notice of Intention Requirement);
(g) the CDN Pref Issuer (as defined below) from the qualification requirements (the Qualification Requirements) of Part 2 of NI 44-101, such that the CDN Pref Issuer is qualified to file a prospectus in the form of a short form prospectus;
(h) the Issuers from the requirement to incorporate by reference into a short form prospectus the documents under paragraphs 1 to 4 and 6 to 8 of subsection 11.1(1) of Form 44-101F1 — Short Form Prospectus (Form 44-101F1) (the Incorporation by Reference Requirements);
(i) the Issuers from the requirement to include in a short form prospectus the earnings coverage ratios under section 6.1 of Form 44-101F1 (the Earnings Coverage Requirements); and
(j) the Issuers from the requirement to include in a short form prospectus the disclosure of one or more subsidiary credit supporters required by section 12.1 of Form 44-101F1 (the Subsidiary Credit Supporter Requirements and together with the Incorporation by Reference Requirements and the Earnings Coverage Requirements, the Prospectus Disclosure Requirements),
in each case to accommodate: (a) the issuance by the Debt Issuers (as defined below) of debt securities (the Debt Securities) guaranteed by the Guarantors (as defined below); and (b) the issuance by the CDN Pref Issuer of preferred shares (the Preferred Shares and together with the Debt Securities, the Securities) guaranteed by the Guarantors (collectively, the Exemption Sought).
Furthermore, the principal regulator in the Jurisdiction has received a request from the Filer for a decision that the application and this decision be kept confidential and not be made public until the earlier of: (a) the date on which any Issuer and/or the Filer issues a news release announcing that the Issuers have entered into an agreement relating to an offering of Securities; (b) the date on which an Issuer and/or the Filer otherwise publicly announces an offering of Securities; (c) the date on which any Issuer files a preliminary short form prospectus relating to an offering of Securities; (d) the date on which the Filer advises the principal regulator that there is no longer any need for the application and this decision to remain confidential; and (e) the date that is 90 days after the date of this decision (the Confidentiality Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11 102 — Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, the Northwest Territories, Yukon and