Headnote
Subsection 1(10) of the Securities Act - Application by a reporting issuer for an order that it is not a reporting issuer - To the knowledge of the reporting issuer, and based on diligent enquiry, residents of Canada (i) do not directly or indirectly beneficially own more than 2% of each class or series of outstanding securities of the reporting issuer worldwide, and (ii) do not directly or indirectly comprise more than 2% of the total number of shareholders of the Filer worldwide - Issuer is subject to Australian securities law and requirements of the ASX - Issuer has provided notice through a press release that intended to submit an application to cease to be a reporting issuer in Ontario.
Applicable Legislative Provisions
Securities Act (Ontario), s. 1(10)(a)(ii).
October 29, 2013
IN THE MATTER OF THE SECURITIES LEGISLATION OF BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN, MANITOBA, ONTARIO, NEW BRUNSWICK, NOVA SCOTIA, PRINCE EDWARD ISLAND AND NEWFOUNDLAND AND LABRADOR (THE “JURISDICTIONS”)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF MINERAL DEPOSITS LIMITED (THE “FILER”)
DECISION
Background
The securities regulatory authority or regulator in each of the Jurisdictions (the “Decision Maker”) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the “Legislation”) that the Filer is not a reporting issuer in the Jurisdictions (the “Decision Sought”).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a coordinated review application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
(b) the decision is the decision of the principal regulator and evidences the decision of each other Decision Maker.
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 Filer:
The Filer is a company established under the Australian Corporations Act 2001 (Commonwealth).
The registered and head office of the Filer is located at Level 17, 530 Collins Street, Melbourne Victoria 3000 Australia.
The Filer has no operations, employees or offices in Canada.
The Filer is an Australian based mining company in the business of finding, mining and processing mineral sands resources. The Filer owns 50% of TiZir Limited which owns the Grande Côte Mineral Sands Project in Senegal, West Africa and an ilmenite upgrading facility in Tyssedal, Norway.
The Filer’s ordinary shares have been listed on the ASX since March 10, 1997.
The Filer is a reporting issuer in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador (the “Jurisdictions”), and its outstanding ordinary shares were listed for trading on the Toronto Stock Exchange (“TSX”) and currently are listed on the Australian Securities Exchange (“ASX”).
The Filer became a reporting issuer in the Jurisdictions upon the completion of its initial Canadian public offering pursuant to a final prospectus dated December 12, 2007.
The Filer qualifies as a “designated foreign issuer” under National Instrument 71-102 Continuous Disclosure and Other Exemptions Relating to Foreign Issuers and has relied on and complied with the exemptions from Canadian continuous disclosure requirements afforded to designated foreign issuers under Part 5 of National Instrument 71-102.
The capital structure of the Filer is composed of an unlimited number of ordinary shares, without par value. As of June 28, 2013, 83,538,786 shares were issued and outstanding and 250,000 unvested performance rights over ordinary shares were on issue. There is no exercise price pertaining to the performance rights and all expire on 31 August 2016.
The TSX has confirmed that the ordinary shares were delisted from the TSX at the close of trading on June 29, 2012. Following the delisting from the TSX, the Filer’s Canadian share register was closed on July 27, 2012.
The Filer is not eligible for the simplified procedure pursuant to CSA Staff Notice 12-307 and BC Instrument 11-502 is not available as its securities are traded on a marketplace in Australia.
Residents of Canada do not, directly or indirectly, beneficially own more than 2% of each class or series of outstanding securities of the issuer worldwide. The due diligence conducted by the Filer in support of the foregoing representation is as follows:
a) The share register analysis was conducted based on an extract of the register of members of the Filer dated June 28, 2013. As of this date there were 83,538,786 ordinary shares on issue and outstanding and administered on a single Australian share register. The register extract consisted of all shareholdings of greater than or equal to 50,000 shares and contained a total of 37 registered securityholders which made up 94.62% of the total share capital on issue.
b) In order to undertake the analysis, tracing notices pursuant to section 672A(1)(a) of the Corporations Act, 2001 (“the Act”) were issued by Orient Capital Pty Ltd (“Orient Capital”) as the Filer’s duly appointed Agent. A direction under section 672 of the Act obligates the recipient of the tracing notice to disclose underlying beneficial ownership/relevant interest information to the issuer. The tracing notices were served on registered (direct) securityholders (irrespective of domicile) recognised as a custodian, nominee or broker (“Custodian”) holding, requesting disclosure of underlying beneficial ownership/relevant interest details of the total shares held under their custody. On receipt of the disclosure information from the registered holders, subsequent tracing notices pursuant to section 672A(1)(b) of the Act were issued to disclosed (indirect) entities (irrespective of domicile) requesting underlying beneficial ownership/relevant interest details and total shares held under their custody. This process continued until the ultimate beneficial owner/relevant interest holders were identified. As a result of this process on both direct and indirect Canadian-based securityholders, Canadian-based securityholders were identified and the Canadian holder report was compiled. The report illustrates the beneficial owners or investment managers domiciled in Canada.
c) In cases where a Canadian domiciled Custodian was not in a position to disclose the name and address details of the beneficial owner/relevant interest holders under their custody due to the Canadian Privacy Laws, Orient Capital obtained a generic breakdown of the number of beneficial holders under custody together with total shares held by each securityholder together with the respective Canadian state of domicile in which the securityholder resides. One Canadian Custodian holding 300 shares (0.00036% of the Filer’s issued capital) would not provide the generic breakdown. In