12 February 2003 External T.I. 2002-016754 -
If there are two series of unit trust with units of the first series having a fair market value between $10 and $25, and units of the second series having a fair market value between $25 and $100, and there are not at least 150 unitholders each holding at least 25 units of the second series, then for purposes of determining block size it would be appropriate to consider the least valuable unit in the class. Thus, if there were 100 unitholders of the first series each holding at least 100 units, there have to be at least 50 unitholders of the second series each holding at least 100 units.
Insider of a Corporation
Where a security issuer is exempt from the prospectus requirement under applicable provincial law, an offering memorandum filed with the securities regulator containing information similar to, and prepared for the same purpose as, a prospectus will generally be considered a "similar document" for the purposes of s. 4803(2)(a).
In response to a query as to "whether a mutual fund trust's status under the...ITA...would be adversely affected if the Ontario Securities Commission (the "Commission")...refused to issue a receipt for any prospectus filed with the Commission following the filing of an earlier prospectus which had been accepted by the Commission, CRA stated:
...a distribution of units of a class in accordance with the initial prospectus accepted by the Commission would satisfy the essential requirement of paragraph 4803(2)(a) of the Regulations such that the class of units so distributed would be qualified for distribution to the public. The fact that subsequent events preclude the trust from issuing any further units of that class to new or existing unitholders does not alter the fact that a lawful distribution of units of that class has previously been made in accordance with a properly receipted prospectus.
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1997 Ruling 3-97979 -
Units of a unit trust will be "qualified for distribution to the public" if an offering memorandum has been filed with the Ontario Securities Commission in accordance with the private placement exemption in s. 72(1)(d) of the Securities Act (Ontario).
For purposes of calculating the number of beneficiaries of the unit trust, each annuitant of a group RRSP will be considered a beneficiary of the unit trust.
30 April 1997 External T.I. 5-952922 -
Before going on to indicate that a mutual fund trust indenture and statement of portfolio transaction filed with provincial securities commission would not be considered to be a document similar to a prospectus or registration statement. CRA stated:
"consequently, we are of the view that to be considered a 'similar document' for the purposes of paragraph 4803(3)(a) of the Regulations, a document should contain information similar to, and be prepared for the same purpose as, a prospectus or registration statement. This was the case in those ruling where we indicated that a mutual fund trust, which had prepared and delivered an offering memorandum to prospective investors and the applicable securities commission but had not filed a prospectus, would meet the requirements of that paragraph."
29 September 1994 Memorandum 940941 [filing of offering memorandum]
A trust, that has not filed a prospectus, will meet the requirements of Regulation 4803(2)(a) if: "(a) an offering memorandum, which is similar to but contains less information than a prospectus, is filed with the applicable securities regulators or (b) a document similar to that of an offering memorandum, such as an information folder or information memorandum is filed with a provincial authority in accordance with Loan and Trust Corporations Act of that province. These are the only two 'similar documents' accepted in our written correspondence."